Canada Faces New Tariff Increases from the U.S.
On Thursday, Canada was hit with new tariffs by the Trump administration.
Beginning August 1, the U.S. will implement a 35% tariff, a significant increase from the previously announced 25%. Trump made this announcement on his Truth Social platform, pointing to trade deficits as a potential threat to both the economy and national security. He also linked Canada’s role in fentanyl trafficking to the decision to impose these tariffs.
This isn’t the first time tariffs have been discussed; earlier this year, Trump called for action against Canada, China, and Mexico regarding the flow of fentanyl into the United States, which has resulted in numerous American overdoses. On Thursday, he reiterated that Canada has not done enough in this effort.
Trump stated, “The U.S. has imposed tariffs on Canada to deal with Canada’s fentanyl crisis,” indicating frustration over the perceived inaction on this issue, while Canada has responded by introducing its own tariffs.
The newly proposed tariff of 35% reflects a growing tension between the two neighbors. “If Canada worked with me to stop the flow of fentanyl, I might consider revisiting these tariffs,” Trump mentioned, suggesting that future adjustments could depend on the relationship’s state.
In 2024, Canada was the largest market for U.S. exports, purchasing around $34.94 billion worth of American goods. However, the U.S. imported significantly more from Canada, totaling $412.7 billion and resulting in a trade deficit of $63.3 billion.
The Canadian government has emphasized its commitment to worker and business interests during ongoing trade negotiations, insisting on substantial progress in combating the fentanyl crisis in North America.
Trump has also indicated that by the same August deadline, new tariffs could be imposed on countries that fail to negotiate trade deals with the U.S. Recently, he has threatened increased tariffs on major trading partners like South Korea and Japan while announcing agreements with the UK and Vietnam, as well as a temporary deal with China.
