Listeners, welcome to Canada Tariff News and Tracker, where we break down the latest headlines and tariff developments on the U.S.–Canada front.
According to the latest updates, tariff policy between the United States and Canada has shifted rapidly throughout 2025. Early this year, the Trump administration invoked new powers under the International Emergency Economic Powers Act, rolling out sweeping “reciprocal tariffs” that brought the average U.S. tariff rate to nearly 27 percent—its highest in a century. For Canada, this meant a 25 percent tariff on most goods starting in March, with energy and potash at a 10 percent rate, and a subsequent increase to 35 percent on most Canadian goods by summer. Trump also used Section 232 authorities to push steel tariffs to 50 percent and implemented a 25 percent automobile import tariff, directly targeting the cross-border auto industry that has long united the Canadian and U.S. manufacturing sectors. Ford’s CEO, echoing widespread industry frustration, warned this would “blow a hole in the US industry that we have never seen.”
The USMCA, once guaranteeing zero tariffs on compliant goods traded across North America, has been eroded by these new moves. The Trump administration initially delayed but ultimately ended the USMCA exemption for vehicles and parts, meaning most Canadian auto exports now face the full 25 percent penalty unless every aspect of origin compliance is met. Economist Arthur Laffer projected that car prices would rise more than $4,700 per vehicle if these tariffs continued, with significant knock-on effects for consumers and manufacturers alike.
October saw political drama as President Trump added yet another 10 percent tariff specifically on Canada after Ontario Premier Doug Ford’s anti-tariff ads aired during the World Series. The U.S. Senate narrowly approved a resolution to nullify Trump’s global “reciprocal” tariffs, including those on Canada, but with the House blocking tariff reforms, those higher rates remain in place pending further legal and legislative battles.
In the last week, there’s been a glimmer of relief. On November 18, Universal Logistics reported that Trump lifted reciprocal tariffs from a range of agricultural products, effective since November 13. The delisted items include beef, coffee, fertilizer, and more—spanning 237 tariff classifications. This action was aimed at tackling food price increases and was announced alongside broader suspensions of product-specific tariffs.
Meanwhile, ongoing legal scrutiny may further shift the U.S. tariff regime. The Supreme Court is set to decide whether Trump’s emergency tariffs under IEEPA are constitutional. If they’re struck down, major change could be on the horizon, although administration officials have signaled they would pivot to other statutory tools like Section 232 or 301 to maintain pressure.
With the 2026 USMCA review approaching and legislative uncertainty in the air, Canadian exporters and their U.S. partners face a complex and volatile landscape. For now, most Canadian goods still face tariffs as high as 35 percent, auto and steel remain at the center of cross-border tension, and everyone is watching for that pivotal Supreme Court decision.
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