Canada Hits Back with Import Taxes up to 50% on US$20 Billion of Goods

Canada began new import taxes on US$20 billion of American goods just after midnight on Tuesday, with rates from 15% to 50%. The taxes answer US import taxes on Canadian cars, trucks, steel, aluminium and lumber, among other goods. Trade between the two countries was worth nearly $900 billion in 2025, so this fight touches both economies.

The highest rate of 50% applies to US steel, aluminium and some furniture. Cheese, toilet paper and air conditioners face 25%, and forklift trucks face 15%. Canada first put fresh fish and lobster on the list, but removed them after its seafood industry said it needed to process American-caught lobster.

Trade talks broke down in Washington in late August. Prime Minister Mark Carney says Canada wants a lasting agreement and is ready to talk when the US is ready. Jamieson Greer, the US trade representative, blames Canada, saying Washington offered the best terms and Canada refused. Canadian officials say the US added last-minute conditions that would limit Canada's trade deals with other countries and raised concerns about protections for the French language in Quebec.

Economists warn that the import taxes will push up prices for clothing, food and furniture. Ottawa has announced C$7.5 billion in new support for firms and workers, on top of C$25 billion already promised. For now, officials in both countries confirm that no active talks are happening, so prices may keep rising.