The United States Imposes 50% Retaliatory Tariffs Against a Broad Range of Canadian Goods
On July 20, 2026, the United States announced that they will impose 50% tariffs on a broad range of Canadian goods under section 338 of the Tariff Act of 1930 (the Act), effective August 19, 2026. Canadian producers and exporters of specific goods should note that CUSMA originating goods are not exempt. This means that goods that would normally qualify for CUSMA preferential treatment will be subject to the section 338 tariffs.
Pursuant to the Act, President Trump signed three proclamations, each of which outlines a broad range of Canadian goods that will be impacted by the 50% tariffs:
Proclamation 1: Alcoholic Beverages
Goods targeted under this proclamation include beer made from malt, wine, vermouth, undenatured ethyl alcohol of an alcoholic strength by volume of less than 80% vol, essential oils, certain articles of wood, and more.
Goods targeted under this proclamation include milk and cream (concentrated or containing added sugar or other sweetening matter), whey (whether or not concentrated or containing added sugar or other sweetening matter), bones and horn-cores, hop cones, sugars (such as lactose, maltose, glucose and fructose), and more.
Proclamation 3: Motor Vehicles
Goods targeted under this proclamation include food products (such as natural honey), animal products, certain live trees and other plants, certain organic chemicals, wood products, consumer goods such as toys, articles of jewellery, sporting goods, articles of clothing, furniture, and more.
Given the broad range of goods covered by the proclamations, Canadian producers and exporters are encouraged to review their exposure to the tariffs before August 19, 2026. More specifically, Canadian businesses should understand whether or not their goods are impacted. Further, Canadian businesses should monitor whether or not there will be counter measures made by the Government of Canada and whether or not there will be any changes to the US proclamations.
Immediately, we encourage Canadian businesses to review and consider applying for the Government of Canada’s Regional Tariff Response Initiative in southern Ontario. This initiative is available to Canadian businesses located and operating in southern Ontario to help respond to global trade pressures.
Please reach out to our team with specific questions relating to your business.
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