WASHINGTON (AP) — President Donald Trump on Monday imposed 50% tariffs on most Canadian goods, declaring that Canada has unfairly discriminated against American autos, alcohol and dairy products.
The move could unleash a new wave of economic chaos, with risks of higher inflation and further fraying of relations between two nations that had been closely woven together before Trump’s return to the White House.
The administration official previewing the action said that Canada was one of the only nations other than China that retaliated against Trump’s previous tariffs and must be held accountable.
The official insisted on anonymity on a call with reporters to preview the president’s actions and said that Trump signed three proclamations to launch the tariffs under Section 338 of the 1930 Trade Act.
Several Democratic lawmakers last year proposed repealing the section because they said Trump could use it to destabilize the economy.
The new 50% tariffs would exclude energy products, potash, fish and critical minerals, but they would include goods that had previously been protected from import taxes by the United States-Mexico-Canada Agreement, or USMCA.
That 2020 trade pact was not renewed by the US, triggering a new set of negotiations that could run until 2036.
The White House said in a fact sheet that the tariffs would go into effect in 30 days, meaning there is time for negotiations, as Trump has not always followed through on his announced tax hikes on imports.
Canadian Prime Minister Mark Carney said in a statement that his government believes in the “benefits of free and fair trade,” having signed “more than 20 new economic and security partnerships.”
He said Canada is prepared to negotiate with the Trump administration.
“This trade dispute has raised costs for families, particularly in the US,” Carney said.
“Canada stands ready to engage intensively to address outstanding issues with the US to the mutual benefit of our citizens.”
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