President Trump on Tuesday signed orders to ban the importation of many dairy products, alcoholic beverages and motorcycles from Canada in three weeks-a retaliation for Canadian tariffs that took effect earlier the same day.
Trump also modified the scope of some existing 50% tariffs on Canada, removing levies on cement, road salt and some hospital products, while imposing 50% levies on other products including some all-terrain vehicles, boats and cheeses.
The tariff changes will take effect Sept. 15, according to proclamations posted on the White House website, while the trade prohibitions are set to kick in on Sept. 29.
The overall economic impact of the trade moves would initially be small. A senior Trump administration official said the new trade prohibitions would only affect a dollar volume of trade in the "single-digit billions," while the overall volume of Canadian exports affected by the tariffs-$20 billion-would be unchanged after the modifications.
Even so, the effect on industries targeted by the trade prohibitions could be ruinous, should they go into effect. The senior administration official said that the U.S. trade prohibitions are justified due to province-level Canadian bans on U.S. alcohol products, but Trump's team remains in contact with Canadian officials and there could be conversations about finding a resolution in the coming days.
In a post on X Tuesday evening, Dominic LeBlanc, Canada's minister in charge of U.S.-Canada trade, said Canada is assessing the latest tariff measures from the U.S.
"When the US is ready to engage, our government will work in good faith and constructively towards a more secure mutually beneficial trading relationship that fully respects Canadian sovereignty," he said.
The move represents the latest in a series of escalations in the monthslong tariff conflict between the U.S. and Canada. Also Tuesday, Trump posted on Truth Social that he would direct the General Services Administration and U.S. Trade Representative's office to remove Canadian firms from the agency's so-called "Multiple Award Schedules," which connect federal, state and local government agencies with suppliers of a wide variety of products.
The U.S. moves come as retaliation for Canada imposing tariffs ranging from 15% to 50% on about $20 billion of U.S. goods on Tuesday morning-amounting to about 6% of U.S. exports to its northern neighbor. Those tariffs covered a variety of products from electronics and appliances to dairy products, and were themselves a response to Trump's latest round of levies, imposed in late August on $20 billion worth of Canadian goods, or about 5% of its exports to the U.S.
The latest round of tit-for-tat tariffs was almost averted. In late August, the two countries appeared close to an agreement, but negotiations broke down in the final hours before a U.S.-imposed deadline, with each government blaming the other for walking away from the table. Now, Trump's action could invite further tariff retaliation that would hit industries in border states such as Michigan, New Hampshire and Maine that have competitive midterm elections.
More retaliation could be coming in the new year. Trump has threatened to raise levies on Canadian metals and vehicles to 50% on Jan. 1, 2027. The senior administration official said that the threat is still in effect.
Trump has also posted on social media about banning aircraft sales from Canada's Bombardier, but the administration official said the president is still reviewing options on that subject and hadn't taken any action yet.
To impose the tariffs and trade prohibitions, Trump is deploying a never-before-used provision of trade law: Section 338 of the Tariff Act of 1930. That law allows the president to impose trade prohibitions or tariffs of up to 50% on countries that are deemed to be discriminating against U.S. companies, but it has never been tested in court.
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