Canada’s Department of Finance said that it will impose counter-tariffs on U.S. goods, effective Sept. 8, in response to President Donald Trump’s 50% tariff on $27.6 billion of Canadian goods that took effect Aug. 22. Here are five things to know:
- The counter-tariffs match the U.S. dollar for dollar, rate for rate. Canada will apply 15%, 25% and 50% tariffs on U.S. products covering $27.6 billion in imports, with individual rates drawn from the same product lists and matching the corresponding rate the U.S. imposed under Sections 338 and 232.
- The move follows a series of U.S. tariff actions on Canada this summer. President Trump signed three proclamations in July imposing 50% tariffs on Canadian motor vehicles, alcoholic beverages and dairy products under Section 338 of the Tariff Act of 1930, a rarely used authority the administration turned to after the Supreme Court struck down its tariffs imposed under emergency economic powers.
- Pharmaceuticals remain exempt from the underlying U.S. tariff action. Trump’s July proclamation on alcohol exempted patented pharmaceutical articles, along with steel, aluminum, copper and semiconductors, from the new 50% duty, meaning Canadian-sourced patented drugs weren’t hit by that action.
- The 50% Canadian tariff applies to U.S. steel and aluminum products, furniture, and clothing and apparel.
- The American Hospital Association has warned of the cumulative effect of stacking tariffs, cautioning that layering tariffs across trading partners could worsen existing drug shortages and raise hospital costs, though Canada remains a comparatively minor device and drug supplier to the U.S. relative to countries like China and India.
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