United States applies 35% tariff to Canadian goods not covered by CUSMA

Updated August 1, 2025

U.S. President Donald Trump signed an executive order to increase a tariff on Canadian goods to 35 per cent beginning August 1, 2025. In a separate executive order on July 31, President Trump  applied new across-the-board tariff rates ranging from 15 to 41 per cent to dozens of countries.

Prime Minister Mark Carney released a statement in response. “While the Canadian government is disappointed by this action, we remain committed to [the Canada-U.S.-Mexico Agreement], which is the world’s second-largest free trade agreement by trading volume,” the statement read.

“The U.S. application of CUSMA means that the U.S. average tariff rate on Canadian goods remains one of its lowest for all of its trading partners. Other sectors of our economy — including lumber, steel, aluminum and automobiles — are, however, heavily impacted by U.S. duties and tariffs.”

He says the Canadian government will act to protect Canadian jobs, invest in industrial competitiveness, buy Canadian and diversify export markets.

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Updated July 23, 2025

Canada will restrict tariff-free imports of cheap foreign steel to support its domestic steel industry. Prime Minister Mark Carney announced tighter tariff rate quotas, cutting allowable 2024 import volumes from non-free trade countries by half (from 100% to 50%). Imports over that limit will face a 50% tariff.

• No changes to exemptions under the Canada–US–Mexico Agreement (CUSMA).
• Major national initiatives, including housing construction and defence projects, will prioritize Canadian steel.
• Additional tariffs will target steel originating in China, even if processed elsewhere, as part of efforts to counteract unfair competition.

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Updated July 11, 2025

On July 10, 2025, U.S. President Donald Trump released a public letter addressed to Prime Minister Mark Carney threatening to impose a 35% tariff on all Canadian goods entering the United States, effective August 1, 2025. Trump indicated the tariffs would be lifted only if Canadian firms move production to the U.S., and warned that retaliatory actions by Canada would result in even higher levies.

New threats include a 50% tariff on Canadian copper, a sector that exported $9.3B to the U.S. in 2023.

The proposed tariffs would apply across the board, posing significant risks to Canadian exporters, jobs, and industries — especially in manufacturing, steel, aluminum, and automotive.

The proposed 35%  tariff on imports from Canada may not apply to goods that comply with the Canada-U.S.-Mexico Agreement (CUSMA), a Trump administration official has told media outlets.

The move comes as both nations continue negotiations on a trade agreement, with a deadline of July 21, 2025, to avoid the tariffs. Prime Minister Carney and Foreign Affairs Minister Anita Anand have reaffirmed Canada’s commitment to protecting Canadian workers and industries while actively negotiating a resolution.

The Government of Canada is expected to hold further negotiations ahead of the July 21 deadline. The business community, workers, and key stakeholders are urged to monitor developments closely.

From the Prime Minister’s Office (PMO)

Prime Minister Mark Carney responded via social media, stating: “We are committed to defending Canadian workers and businesses. While negotiations continue, we are also strengthening our global trade partnerships.”