Trump Imposes 50% Tariffs on Some Canadian Imports

President Trump issued three proclamations yesterday imposing 50% additional duties on certain Canadian products under Section 338 of the Tariff Act of 1930. The tariffs will go into effect Aug. 19 absent any subsequent agreements.

• The tariffs are intended to “offset the burden or disadvantage on U.S. commerce of Canada’s discrimination or unreasonable and unequal” treatment of U.S. motor vehicles, dairy and alcoholic beverages.
• The new proposed tariffs would apply to about 5% of total U.S. imports from Canada.

The rationale: The Section 338 statute requires a finding of discrimination. Each proclamation asserts that Canada’s measures unreasonably burden and disadvantage certain U.S. exports to Canada.

• The motor vehicle proclamation cites Canadian measures imposed in 2025 in retaliation for U.S. International Emergency Economic Powers Act tariffs. The dairy proclamation asserts that Canada’s tariff rate quota allocation system favors European Union products over U.S. products, and the alcoholic beverage proclamation cites the cessation of Canadian purchases of U.S. alcoholic beverages starting in March 2025.

Which products: Annex I of each proclamation sets forth the products to which the 50% additional ad valorem tariff applies.

• The dairy annex lists mainly dairy products and caseins but includes sugar products and nonalcoholic beer.
• The alcohol annex mainly covers alcohol beverages (beer, wine and spirits), but also includes certain wood and paper products.
• The motor vehicle annex covers a wide range of products unrelated to the sector. These include certain agricultural and food products, select organic chemicals, plastics, leather products, certain plywood, wood products and furniture, certain textiles, certain metals and derivative products, select industrial machinery, electronics components, some printed circuit boards and other products.