WASHINGTON -- President Trump imposed an additional 50% tariff on certain goods from Canada, including wine, hockey sticks and cement, the White House announced Monday.
In a statement, the White House said that the tariffs were a response to the country's "discriminatory treatment of American products." Some sectors and goods, including energy, potash and fish or critical minerals, will be exempt from the new tariffs, the White House said.
The tariffs will take effect 30 days after they are signed and affect about $20 billion worth of Canadian goods.
The White House said the tariffs are "designed to offset the burden and disadvantage" from what it described as Canada's discrimination of U.S. goods, including autos. The White House said the U.S. opposed Canadian policies that require companies to invest in auto production in Canada, rather than the U.S., as well as bans some Canadian provinces have imposed on U.S. liquor products.
The announcement is the latest flashpoint in a tense relationship between the U.S. and Canada as the struggle to renegotiate the U.S.-Mexico-Canada Agreement, which President Trump signed in his first term and is under renegotiation this year.
Canadian Prime Minister Mark Carney's office didn't immediately respond to a request for comment.
Trump has publicly threatened to terminate the USMCA, which he negotiated to replace the North American Free Trade Agreement, known as Nafta. U.S. Trade Representative Jamieson Greer has floated separating the three-nation agreement into two separate pacts -- one with Mexico and one with Canada. While U.S. officials will travel to Mexico this week for talks, the U.S. and Canada haven't yet opened formal negotiations.
The new tariffs, unlike earlier rounds of levies on Canada, will apply to goods that comply with the USMCA deal, the White House said. Should the U.S. opens talks with Canada, Trump could ostensibly cancel the new levies before they are set to be imposed in mid-August.
Trump last year imposed emergency levies on Canada over its alleged role in the fentanyl trade before the Supreme Court ruled in February that those tariffs were illegal. He has also levied so-called national security tariffs on steel, aluminum, auto parts and lumber from Canada, though the White House said that products covered by those earlier levies won't be hit by this latest round.
Carney last year rolled back many of the counter-tariffs that Canada imposed on U.S. goods, but several provinces have kept their retaliatory bans on U.S. wine and spirits in place, drawing repeated complaints from U.S. officials.
Ontario Premier Doug Ford, who is among the provincial leaders who have banned the sale of U.S. wine and spirits at liquor outlets, said in a post on social media Monday that "Canada should respond tariff for tariff, dollar for dollar" if the Trump administration imposes the levies.
The new tariffs come after smoke from raging wildfires in Canada drifted into the U.S., blanketing cities including New York, Chicago and Washington. In a Truth Social post Friday, Trump threatened to impose steeper duties on America's northern neighbor to compensate for the smoke's impact.
"We are holding Canada responsible for the fact that they are not properly maintaining their Forests, and Brush therein, and the United States is being unnecessarily invaded by filthy, polluted, and unhealthy air, the quality of which is dangerous, and totally unacceptable!" Trump said.
Days later, the president was seen speaking with Carney at Sunday's World Cup Final. Trump told reporters that Canada needed to stop the wildfires.
"I told them, I mean, you got to stop these fires from coming in and you know poisoning our air," Trump said. "Our air has been poisoned. Have a good relationship with Mark Carney, but you know we got to stop the fires up there. If we can help them, we'll help them. But maybe they should pay us some damages or something, or we should do some tariffs."
The new tariffs will be imposed under an obscure section of U.S. trade law -- Section 338 of the Trade Act of 1930. That law grants the president the power to impose levies on countries that discriminate against U.S. companies, but hasn't been used before to impose tariffs and could attract legal challenges if the levies are ultimately imposed, said Ryan Majerus, a partner at law firm King & Spalding and former Commerce Department trade official.
(END) Dow Jones Newswires
