United States President Donald Trump has imposed a 50 percent tariff on a wide range of goods imported from Canada, in response to what he called "unequal treatment" of American cars, dairy products and alcoholic beverages.
The goods affected include everyday goods, such as wine and hockey sticks, as well as industrial products such as cement. However, several key exports will be exempted, including energy, potash, critical minerals and fish.
Prime Minister Mark Carney responded that Canada is ready to "intensify" trade negotiations with the US in the coming weeks.
The White House said the tariffs would take effect in 30 days, the BBC reported. The move represents a major escalation in trade tensions between the North American neighbors.
Canada was one of the few countries to retaliate against Trump's tariffs in 2025, imposing a 25 percent levy on about 30 billion Canadian dollars, or 21,7 billion U.S. dollars, worth of U.S. goods. Carney later lifted some of those measures, but kept tariffs on U.S. cars, steel and aluminum.
The U.S. Supreme Court ruled earlier this year that many of Trump's tariffs, imposed around the world under emergency powers, were illegal. But his latest move, Monday night, is based on another, little-known piece of legislation that has not yet been tested in court.
The new tariffs apply to all covered goods, regardless of whether the product is included in the existing free trade agreement between Canada, the United States and Mexico, known as USMCA.
"This is the latest in a series of unilateral U.S. trade moves, which began when the United States imposed a series of tariffs in direct violation of the Canada-United States-Mexico Agreement," Carney posted on X.
He also mentioned "threats to Canadian sovereignty," which could refer to Trump's calls for the US's northern neighbor to become the 51st US state.
The import tariffs, announced on Monday, build on trade barriers that already exist between the two countries.
The US already applies tariffs ranging from 15 to 50 percent on Canadian steel, aluminum and copper. Washington also levies a 35 percent tariff on Canadian softwood lumber, as well as a 25 percent tax on non-US-made auto parts.
Canada, on the other hand, has a 25 percent countervailing duty on certain imports of American steel, aluminum, and vehicles.
Monday's announcement followed President Trump's threat to impose tariffs over smoke from wildfires in Canada reaching American cities.
However, the executive orders Trump signed on Monday make no mention of wildfires.
Instead, the three proclamations address long-standing U.S. trade concerns with Canada, including autos, dairy products and alcohol, suggesting a breakdown in trade talks between the two countries.
When it comes to cars, Trump accuses Canada of charging taxes on American motor vehicles and parts that are not covered by the USMCA agreement.
He claims that this is "unreasonable" and that Canada discriminates against the US by not charging a similar tax to other countries.
The North American automotive industry is highly integrated between Canada, the US, and Mexico.
However, Trump's Commerce Secretary Howard Latnick previously stated that he believes Canada should be "second place" to the US.
Trump has previously cited the auto industry as one of the areas in which the two countries have conflicting interests.
Dairy products have long been a problem for the US, particularly Canada's supply management system, which restricts imports from abroad. Quantities exceeding prescribed limits are subject to tariffs of up to 300 percent.
Finally, the long-running boycott of American alcoholic beverages in most Canadian provinces has become a major point of contention for Americans since it was introduced last year.
Canadian provincial premiers have repeatedly said that the boycott will be lifted if the US removes tariffs on key Canadian sectors, including metals and automobiles.
Canadian trade negotiators were trying to reach an agreement that would reduce at least some of the existing US tariffs.
"If these tariffs go into effect, Canada should respond tariff for tariff, dollar for dollar," Ontario Premier Doug Ford wrote on X, reacting to the announcement of the new tariffs.
The BBC says it has asked the White House and the Canadian government for comment.
Earlier this year, the US decided not to renew the USMCA agreement in its current form.
Canada and Mexico have sought to renew the trade agreement, but the US wants to amend the deal reached during Trump's first term.
In its current form, the agreement will continue to govern trade in North America for the next decade, based on a system of automatic renewal and with mandatory annual reviews.
The U.S. Supreme Court in February struck down sweeping international tariffs imposed by Trump under the International Emergency Economic Powers Act of 1977.
The judges concluded that the president exceeded his authority when he declared the tariffs based on a law intended for national emergencies.
The White House then promised to use other mechanisms to impose import taxes.
The tariffs announced Monday were imposed under Section 338 of the Tariff Act of 1930, which deals with trade discrimination, not national emergencies.
Candans Laing, president of the Canadian Chamber of Commerce, called the latest tariffs a “regrettable decision” and urged officials to make “significant progress” in negotiations before the new measures take effect in 30 days.
Chris Swanger, president of the United States Distilled Spirits Council, also called on both sides to find a solution, warning that the decision "increases the risk of new countermeasures."
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