Ottawa matches Washington’s latest duties dollar-for-dollar as trade war between longtime allies deepens; support package unveiled for affected workers and businesses.
Canada has announced retaliatory tariffs covering approximately $20 billion worth of United States goods, escalating a bitter trade dispute with its southern neighbour after negotiations collapsed and Washington imposed sweeping new duties.
In a move described by Canadian officials as a “proportionate” and “strategic” response, Ottawa said the counter-tariffs would take effect on 8 September and apply rates of 15 percent, 25 percent and 50 percent to around 700 products imported from the US. The measures match, dollar for dollar, the 50 percent tariffs that the Trump administration placed on roughly $20 billion of Canadian exports starting 22 August.
Canada Hits Back With New Tariffs on US Goods:
Finance Minister François-Philippe Champagne confirmed the details on Tuesday, stating that Canada would impose duties “rate for rate” on goods drawn from those targeted by the US measures. Fifty-percent tariffs will hit US steel and aluminium products (doubling previous counter-tariffs), as well as furniture and clothing. Twenty-five-percent duties will apply to cheese and other dairy products, appliances and certain seafood, while electronics and tools face a 15-percent levy.
“We’re not going to bend, we’re not going to break, we’re going to build,” said Evan Solomon, Canada’s minister for AI and digital innovation, capturing the defiant tone in Ottawa.
The escalation follows the breakdown of intensive trade talks late last week. Canadian Prime Minister Mark Carney suspended negotiations, accusing the United States of presenting “unfair” and “uneconomic” last-minute demands that threatened Canadian sovereignty and key industries, including the automotive sector. Carney said Canada had been “pragmatic, patient and persevering” but could not accept the terms offered. “You’re at war when you get attacked. We got attacked,” he earlier declared.
US President Donald Trump’s new tariffs, imposed under a Depression-era provision of the Tariff Act of 1930, affect about 5 percent of Canada’s exports to the United States and cover a range of products from dairy and wine to furniture and hockey equipment. On Monday, Trump further raised the stakes by pledging to raise tariffs on Canadian autos, trucks and parts to 50 percent beginning 1 January 2027.
Canada Unveils $5.4B Aid Package Amid US Tariff Fight:
The Canadian government unveiled a C$7.5 billion ($5.4 billion) support package for workers and businesses hit by the US measures. The package includes enhanced funding for small and medium-sized enterprises, liquidity support through the Business Development Bank of Canada, and assistance for workers at risk of job losses. Officials said the measures build on nearly $25 billion in previous supports provided since earlier rounds of US tariffs.
Industry Minister Mélanie Joly emphasised that the response also seeks to encourage Canadians to buy domestic products and targets specific US states whose exports will be most affected. “This focused response will protect Canadian workers, farmers, fishers, families and businesses,” the government said in its official statement.
The tit-for-tat tariffs mark a sharp deterioration in relations between the two closely integrated economies, which together form one of the world’s largest trading relationships. Economists warn that the measures will raise costs for consumers and businesses on both sides of the border and could disrupt supply chains that have long operated with minimal friction.
Neither the White House nor the US Trade Representative’s office immediately responded to requests for comment on Canada’s announcement. With both sides digging in and further tariff threats already on the table, the prospects for a swift resolution appear limited, leaving businesses and workers on both sides of the border bracing for prolonged economic pressure.