Trump imposes 35 percent tariffs on Canadian imports

On July 10, 2025, President Donald Trump threatened Canada with a 35 percent tariff on its exports to the United States, effective August 1. This decision is part of an ongoing trade war initiated by Trump, targeting several economies. The President expressed his frustrations in a letter to Canadian Prime Minister Mark Carney, citing Canada's inadequate efforts to curb drug trafficking into the U.S. and retaliatory tariffs imposed by Canada on American goods. The tariffs were also a blow to trade negotiations underway between Canada, Mexico, and the United States, aimed at reaching a deal by July 21. The escalation from a prior 25 percent tariff on Canadian and Mexican imports marks a significant shift in U.S. trade policy, particularly as relations between the U.S. and Canada had seemingly improved following recent diplomatic meetings. Notably, Canada was the largest buyer of American goods last year, purchasing approximately $350 billion worth of American products. This new tariff may threaten these economic ties and complicate efforts to finalize the United States-Mexico-Canada Agreement (USMCA), which Trump renegotiated during his presidency. Congressional and business leaders are likely to be unsettled by the announcement, as heightened tariffs can disrupt markets and trade dynamics. As Trump has issued similar letters to over 20 other countries, his administration appears to be taking a firmer stance on trade relations globally, emphasizing his strategy of leveraging tariffs as a negotiating tool. The imminent deadline for a trade agreement with Canada and Mexico adds urgency to the situation, as both nations work to accommodate U.S. demands amid fears of economic fallout. Furthermore, while exemptions were previously made under the USMCA, it remains uncertain if these tariffs will be subject to similar exclusions, raising concerns among Canadian producers and American companies reliant on imports. The political and economic consequences of such tariffs could reverberate in both countries, impacting consumers, producers, and the overall market. The threat of significant tariffs could provoke a range of responses from the Canadian government, which may lead to additional negotiations or retaliations in the form of new tariffs on U.S. goods.