Overview

• Starting August 1, a 35% levy will apply to Canadian imports not covered by USMCA provisions, with sectoral and free-trade exemptions yet to be finalized.
• Trump linked the tariff increase to Canada’s alleged failure to curb cross-border fentanyl trafficking and cited a $63 billion goods trade deficit.
• His letter warned that any Canadian retaliatory tariffs would be met with an additional 35% duty on exports to the United States.
• A White House official suggested goods complying with the 2020 USMCA and key energy and potash exports may remain under lower rates, although no formal decision has been released.
• Prime Minister Mark Carney pledged to defend Canadian workers and businesses and to secure an agreement before the August 1 deadline.