US President Donald Trump on Monday imposed 50 per cent tariffs on most Canadian goods, declaring that Canada has unfairly discriminated against American cars, alcohol and dairy products.
The move could unleash a new wave of economic chaos, with risks of higher inflation and further fraying of relations between two nations that had been closely woven together before Trump’s return to the White House.
The administration official previewing the action said that Canada was one of the only nations other than China that retaliated against Trump’s previous tariffs and must be held accountable.
The official insisted on anonymity on a call with reporters to preview the president’s actions and said Trump signed three proclamations to launch the tariffs under Section 338 of the 1930 Trade Act.
Several Democratic lawmakers last year proposed repealing the section because they said Trump could use it to destabilise the economy.
The 50 per cent tariffs would exclude energy products, potash, fish and critical minerals but they would include goods that had previously been protected from import taxes by the United States-Mexico-Canada Agreement, or USMCA. That 2020 trade pact recently expired and triggered a new set of negotiations that could run until 2036.