CANADA BRACES FOR 50 PERCENT U.S. TARIFFS AS DEADLINE NEARS

Developing story: Tariff coverage, exemptions, leader-level talks and deadline timing may change before the duties take effect.

Canada is bracing for a new round of U.S. tariffs as a Wednesday deadline approaches with negotiators still far apart and vulnerable industries warning of job losses. Reuters reported that President Donald Trump’s threatened 50 percent duties would apply to nearly $20 billion of Canadian goods, including wine, furniture, dairy products, cement, clothing, fishing rods and hockey equipment.

The tariffs are unusually aggressive because Trump invoked Section 338 of the Tariff Act of 1930, a Depression-era provision that permits punitive tariffs against trading partners deemed to have discriminated against U.S. goods. Reuters reported that the provision is best known for the broader tariff escalation that economic historians say worsened the Great Depression.

The scale is targeted but serious. The covered goods amount to about 5.2 percent of the $383 billion in goods the United States imported from Canada in 2025, according to U.S. Census Bureau data cited by Reuters. For individual sectors and small exporters, however, a 50 percent tariff can be enough to make U.S. sales uneconomic almost overnight.

Prime Minister Mark Carney declined Monday to discuss the details of what he described as intense and delicate negotiations, Reuters reported. Carney said he expected to speak with Trump before the deadline. Canada’s minister responsible for U.S. trade, Dominic LeBlanc, and chief negotiator Janice Charette have stepped up talks with U.S. counterparts.

The dispute includes several longstanding irritants. U.S. officials have pressed Canada over dairy-market access, provincial restrictions on U.S. alcohol and retaliatory duties tied to earlier U.S. measures. Canada is seeking relief from tariffs that have already strained industries including autos, steel and aluminum.

Unlike many earlier Trump tariffs, these duties would apply even to products that qualify for preferential treatment under the U.S.-Mexico-Canada Agreement. That matters because USMCA status has shielded much of Canadian trade from tariffs and has been central to corporate planning in North American supply chains.

Business warnings are already stark. A Canadian cabinet manufacturer quoted by Reuters said a 50 percent tariff could make certain Canadian products economically noncompetitive in the U.S. market. The Canadian Federation of Independent Business warned of major disruption for small firms that rely on U.S. clients.

What is confirmed is that Canada faces a Wednesday tariff deadline, the proposed duties would cover roughly $20 billion in goods and negotiators remain under pressure to find a deal. What remains unresolved is whether Carney and Trump can reach a last-minute agreement, postpone the tariffs or allow a new trade shock to hit Canada-U.S. commerce.

Fact-check date: August 18, 2026. Article type: News. Sources: Reuters; U.S. Census Bureau. Developing note: Tariff coverage, exemptions, leader-level talks and deadline timing may change before the duties take effect.