By Dean Brown.
Good day,
If you've been trying to follow the Canada-U.S. trade war, I don't blame you if you're confused.
We've heard 10%, 25%, 35% and now 50% tariffs. Some actually happened. Some disappeared. Others were struck down by the courts. And now Canada has announced another round of retaliation.
So instead of throwing another tariff headline at you today, I wanted to do something more useful:
What tariffs are actually on Canada right now?
🇺🇸 It started with 25%. Most of that system is now gone.
CBC News Liberation Day
Trump's second-term tariff fight with Canada started in early 2025, when he announced 25% tariffs on most Canadian goods and 10% on Canadian energy, tying them to fentanyl and border security.
The tariffs eventually took effect on March 4. But only days later, Trump exempted goods that qualified under CUSMA.
That changed the picture considerably.
CUSMA-compliant goods: no additional fentanyl tariff
Non-CUSMA goods: 25%
Certain non-CUSMA energy and potash: 10%
Trump eventually increased the general non-CUSMA tariff to 35%, but that entire system ran into a much bigger problem this year.
In February 2026, the U.S. Supreme Court ruled that Trump couldn't use IEEPA emergency powers to impose sweeping tariffs this way. That knocked out the legal foundation underneath the fentanyl tariff system.
Trump responded with a temporary 10% global surcharge under Section 122, but that expired July 24.
So if you still hear people talking about Canada's old 25% or 35% fentanyl tariff, that's no longer the main tariff Canadians should be focused on.
WATCH: W hat Tariffs Are Actually on Canada Right Now?
@deanbrownca We’ve heard 10%, 25%, 35% and 50% tariffs thrown around for almost two years. The reality is that Canada is dealing with several separate ... See more
🏭 The tariffs that survived are the important ones
Here's where things get confusing.
Trump didn't impose every tariff using the same law.
His steel, aluminum and automobile tariffs were imposed under Section 232, a national-security trade law. That meant they weren't automatically eliminated by the Supreme Court decision.
Canada is therefore still dealing with separate tariffs on major industries:
Steel: up to 50%
Aluminum: up to 50%
Automobiles and parts: generally a 25% framework, although the actual treatment varies
Selected Canadian products: 50% under Trump's newest tariff package
The steel and aluminum tariffs were doubled from 25% to 50% in June 2025, while automobile tariffs were imposed separately under Section 232.
These are the tariffs that have become much harder for Canada to escape.
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📈 Then Trump found another way to impose 50% tariffs
After losing his emergency-tariff authority, Trump turned to another law: Section 338 of the Tariff Act of 1930.
It's a rarely used provision that allows the president to impose tariffs of up to 50% when another country is deemed to discriminate against American commerce.
Trump targeted Canada over disputes involving dairy, American alcohol and automotive policy.
The tariffs were supposed to begin August 19, but Trump delayed them for three days while Canada and the U.S. tried to finish a trade agreement.
We know how that ended.
Talks collapsed, and on August 22, the new 50% tariffs took effect on roughly C$27.6 billion — about US$20 billion — of Canadian exports. Read the AP breakdown of the failed negotiations
But here's the important part:
Canada does NOT face a blanket 50% tariff on everything we sell to America.
The latest tariff applies to a selected group of products. Major categories such as energy and potash are excluded, as are products already being dealt with under certain other tariff systems.
Roughly 5% of Canada's exports to the United States are affected by this latest package.
That's still economically significant. It's just very different from saying everything Canada sells now has a 50% tariff.
🇨🇦 Canada is hitting back September 8
The Varsity
Now Ottawa has officially announced its response.
Starting September 8, Canada will impose new tariffs on approximately C$27.6 billion of American imports.
The rates will be:
15% · 25% · 50%
Canada says it's responding dollar-for-dollar and rate-for-rate, targeting more than 700 tariff lines across products including steel, dairy, appliances, agricultural equipment, electronics, pulp and paper.
That comes on top of the retaliatory tariffs Canada already kept on American steel, aluminum and vehicles after Ottawa removed most of its broader 2025 counter-tariffs.
There is something important to understand about who pays these.
If Canada puts a 50% tariff on a $1,000 American appliance, the American manufacturer doesn't simply send Ottawa $500.
The Canadian importer pays the tariff.
Some of that cost might be absorbed by the importer, retailer or American manufacturer. Some could also eventually reach Canadian consumers through higher prices.
Trump's tariffs work the same way: American importers pay U.S. tariffs, not the Canadian company shipping the product across the border.
That's why a tariff war can hurt the country you're targeting while also costing people at home.
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🚗 January 1 could be the real danger for Canada
This is the part I'd pay the most attention to.
Trump has now threatened to increase tariffs on Canadian cars, trucks and automotive parts to 50% beginning January 1, 2027.
That 50% auto tariff is not in effect today.
But if it happens, I think this trade war enters a much more dangerous phase for Canada.
Canada and the United States don't really have two completely independent auto industries. We have an integrated North American supply chain, where parts can cross the border multiple times before a finished vehicle reaches a dealership.
And the biggest threat isn't necessarily an Ontario factory suddenly shutting down on January 2.
It's the next investment decision.
When Ford, GM, Stellantis, Honda or Toyota decides where its next vehicle program or production line goes, a long-term 50% tariff disadvantage could make an American plant much more attractive.
Trump has been pretty clear about what he wants: build it in America and avoid the tariff.
That's why I think the auto fight could matter much more over the next five or ten years than many of the consumer-product tariffs getting attention today.
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🧾 So what tariffs are actually on Canada today?
Here's the simplest way I can put it:
U.S. tariff | Rate | Right now? |
|---|---|---|
Original fentanyl/emergency tariff | 25%, later 35% | ❌ No |
Temporary global surcharge | 10% | ❌ Expired |
Steel | Up to 50% | ✅ Yes |
Aluminum | Up to 50% | ✅ Yes |
Autos/parts | Generally 25% framework | ✅ Yes |
New Section 338 products | 50% | ✅ Yes |
New 50% auto threat | 50% | ⏳ Jan. 1 if implemented |
So when someone says:
“Trump put a 50% tariff on Canada.”
That's not quite right.
There are several different tariff systems, covering different products and created under different U.S. laws.
And that's probably the biggest reason this entire trade war has become so difficult to follow.
📅 Two dates matter now
After going through nearly two years of announcements, exemptions, retaliation and court rulings, I'd really only keep two upcoming dates in mind.
September 8
Canada's new 15%, 25% and 50% counter-tariffs are scheduled to begin.
January 1
Trump says Canadian cars, trucks and auto parts will face 50% tariffs if the announced escalation goes ahead.
The Supreme Court didn't end Trump's tariff strategy.
It forced him to rebuild it using different trade laws.
And I think that's where this story gets more serious.
Steel and aluminum are already being hit. Another C$27.6 billion of Canadian exports just entered the 50% tariff fight. Canada is retaliating.
But autos could determine whether this remains a very painful trade dispute or starts permanently changing where companies put North American factories, investment and jobs.
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Dean Brown
P.S.
What part of the Canada-U.S. trade war still confuses you?
Reply to this email and let me know. If enough people are asking the same question, I'll break it down in a future edition of Canada Explained.