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Canada to Lift Retaliatory Tariffs on USMCA‑Compliant U.S. Goods, Keep Steel and Auto Duties

The change is pitched as a reset to sectoral talks ahead of the 2026 USMCA review.

Canada's Prime Minister Mark Carney, listens as President Donald Trump speaks during a group photo at the G7 Summit, Monday, June 16, 2025, in Kananaskis, Canada. (AP Photo/Mark Schiefelbein)
Prime Minister Mark Carney in Ottawa on Friday.
Prime Minister Mark Carney departs a press conference at the National Press Theatre in Ottawa, on Friday, Aug. 22, 2025. THE CANADIAN PRESS/Spencer Colby

Overview

  • Effective Sept. 1, Ottawa will lift 25% counter-tariffs on U.S. goods that meet USMCA rules of origin, mirroring Washington’s carve-out.
  • Tariffs on steel, aluminum and automobiles will remain as Canada pursues resolutions in those sectors it calls strategic.
  • The announcement followed a CarneyTrump phone call described by Ottawa as productive, with both sides planning to intensify negotiations.
  • A White House official welcomed the rollback as “long overdue,” while opposition leader Pierre Poilievre and Unifor’s Lana Payne condemned it as backing down.
  • Officials say more than 85% of CanadaU.S. trade is already tariff-free and the U.S. average tariff on Canadian goods is about 5.6%, as Canada readies for the USMCA review.