Canada’s retaliatory tariffs on about $20 billion worth of U.S. goods take effect Tuesday, turning its escalating trade war with President Donald Trump into a test watched far beyond the border: Can a country much smaller than the United States stand u... TORONTO -- Canada struck back at U.S. President Donald Trump on Tuesday with tariffs on about $20 billion worth of U.S. goods, in response to the latest round of tariffs on Canada.
The outcome could resonate far beyond Canada, showing other governments whether a smaller U.S. ally can withstand Trump’s economic pressure. Canadian Prime Minister Mark Carney says U.S. demands could hollow out key Canadian industries and limit the country’s independence, while Trump’s threats to Canadian sovereignty have rallied the public behind him. Canada says its tariffs match Washington’s dollar for dollar and rate for rate.
They take effect at 12:01 a.m. Tuesday under an executive action known as an order in council and cover about $20 billion in American goods, roughly 6% of the $333.6 billion the United States exported to Canada last year. RBC Economics, the research arm of the Royal Bank of Canada, said the measures were unlikely to dent U.S. growth overall but could hit some businesses hard.
Canada has already gone beyond tariffs in other ways. Eight of its 10 provinces continue to restrict or ban sales of U.S. alcohol. The Distilled Spirits Council says U.S. spirits exports to Canada fell more than 70% year over year after those restrictions took effect.
Since Canada-U.S. trade talks collapsed Aug. 21, Trump and his administration have unleashed a barrage of tariffs, threats and personal attacks portraying Canada as weak and dependent. On Monday, Trump threatened to ban the sale of aircraft from Canada’s Bombardier, unless they manufacture planes in the United States. Their products aren’t good enough!” Trump posted on Truth Social.
Trump previously warned that Canada’s economy could collapse if Carney continued treating him as “the enemy” and threatened consequences "worse than anything that has ever happened to a Canadian Politician.” U.S. Trade Representative Jamieson Greer has threatened that Washington could ban some Canadian goods outright in response. Trump even renamed Lake Ontario “Lake America,” a change ignored and ridiculed in Canada.
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