President Donald Trump announced Thursday that the US will apply 35% tariffs on all imports from Canada starting next month, reviving tensions with key trading partners that have largely dissipated in recent weeks.
“Instead of working with the US, Canada retaliated with its own tariffs,” Trump wrote in a letter sharing about the true society. “From August 1, 2025, Canada will charge a 35% tariff on Canadian products sent to the US, separate from all sectors’ duties.”
Up until this escalation, Canadian imports, which did not fall under the US-Canada trade agreements that Trump negotiated in his first term, faced a 25% tariff. Energy imports from Canada face 10% tariffs.
Trump told NBC News in an interview early Thursday that he would announce Canada’s new tariff rates by the weekend.
Canada is one of the top trading partners in the US, with over $4100 billion in goods spreading to the country last year. However, since Prime Minister Mark Carney took office in March, the two countries have built a business relationship.
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Canadian Prime Minister Mark Kearney and President Donald Trump in the White House’s oval office on May 6th.
In late June, Trump announced that he had concluded all trade talks with Canada, citing the Digital Services Tax, which is due to be imposed by June 30th.
Canada retaliated, imposing quotas on some steel imports and surcharges of 50% for imports above the quota. The Canadian Finance Minister said the government is acting to protect the industry from “unfair US tariffs.”
But Trump’s letter on Thursday may come as a surprise to Carney. After he withdrawn Canada’s Digital Services Tax to appease Trump on June 29, the two leaders spoke on the phone and agreed to work towards a trade deal by July 21.
Trump called the Digital Services Tax a “attack” against the US and its tech giants. The tax would have been applied to high-tech companies making more than $15 million from Canadian internet users. A lobby group of large US high-tech companies said they will be forced to pay up to $3 billion on June 30th.
In his social media post Thursday night, Trump said the US would appreciate the 35% tariff if Canada retaliated again.
Canada’s top trade negotiators and their US ambassadors said this week that Canadian and American teams are in contact with almost a day of contact and working towards an agreement.
“If Canada worked with me to stop the fentanyl flow, we would probably consider adjusting to this letter,” Trump wrote at the end of his letter. “You will never be disappointed with the United States.”
Canada has called Trump’s claim that a large amount of fentanyl crossing the northern border was “unjust.”
US stock futures quickly slipped through Trump’s post. The S&P 500 index shows its decline at about half the rate at the opening bell on Friday. Dow Jones’ industrial average futures were set to above 200 points.
Customs duties or duties are taxes on products purchased from overseas and are used in virtually all countries.
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