POTUS PAUSES CANADA TARIFFS AFTER LAST-MINUTE DEAL CLAIM

Developing story: Final documents, tariff timing, product coverage and Canadian responses may change before the three-day pause expires.

President Donald Trump paused planned 50 percent tariffs on Canadian goods for three days after saying the United States and Canada had reached a deal, averting the duties less than two hours before they were scheduled to take effect. Reuters and the Associated Press reported that Canadian Prime Minister Mark Carney said substantial progress had been made but important work remained.

The tariffs had been set to begin at 12:01 a.m. Wednesday and would have applied to about $20 billion worth of Canadian imports. AP reported that the affected goods ranged from hockey sticks to tongue depressors. The pause gives negotiators more time but does not yet provide the public with final terms or certainty that the dispute is resolved.

Trump said on Truth Social that he paused the tariffs because the countries had a deal, subject to final documentation. Carney’s statement was more cautious, saying negotiations had made substantial progress but that Canada would continue focusing on building a stronger and more competitive economy at home.

The difference in tone matters. Washington is presenting the announcement as a deal. Ottawa is framing it as progress with unresolved work. Businesses affected by the threatened duties must therefore plan around a temporary reprieve, not a fully published settlement.

The tariffs were politically significant even if their direct economic footprint was limited compared with total Canada-U.S. trade. Canada and the United States sold each other about $880 billion in goods and services last year, AP reported. A targeted tariff on $20 billion in goods could still damage specific sectors and trigger retaliation if implemented.

The dispute has centered on U.S. claims that Canadian policies discriminate against American alcohol, dairy and vehicles, along with Canadian efforts to win relief from U.S. tariffs on steel, aluminum and autos. Reuters reported that the sides have also discussed cutting U.S. Section 232 tariffs on Canadian vehicles to 15 percent from 25 percent, with deductions tied to U.S. content.

For Canadian exporters, the pause reduces immediate risk but does not end uncertainty. Contracts, shipments, inventory and pricing decisions now depend on whether the three-day window produces final documents, another extension or a renewed tariff threat. Small firms may be particularly exposed because they have fewer options for absorbing sudden duties.

What is confirmed is that Trump paused the tariffs for three days and said a deal exists, while Carney described substantial progress with more work ahead. What remains unresolved is the final text, the fate of auto tariff cuts, the treatment of Canadian retaliation and whether the pause becomes a durable trade settlement.

Fact-check date: August 19, 2026. Article type: News. Sources: Reuters; Associated Press; Office of the United States Trade Representative. Developing note: Final documents, tariff timing, product coverage and Canadian responses may change before the three-day pause expires.