U.S. tariffs on Canadian goods will come into effect Saturday, White House says
U.S. President Donald Trump says tariffs will eventually include Canadian oil
U.S. President Donald Trump on Friday offered vague details on his plans to impose tariffs on goods coming from Canada, Mexico and China, after a spokesperson said they would take effect Saturday.
White House press secretary Karoline Leavitt said the president would put a 25 per cent tariff on Canada and Mexico and a 10 per cent tariff on goods from China during a briefing on Friday.
Speaking to reporters in the Oval Office hours later, Trump said he expects the tariffs would include oil, gas, steel, aluminum, copper and microchips — but potentially with staggered dates and rates, depending on the product.
"We're going to put tariffs on oil and gas," Trump said. "That'll happen fairly soon, I think around the 18th of February."
He also said:
- The levy on oil would "probably" be set at a lower 10 per cent, but it was unclear whether lower duties would apply from the start.
- There would be "a lot of tariffs" on steel and aluminum.
- Tariffs would "ultimately" include copper, though that will "take a little bit longer."
- He was not concerned about the reaction of financial markets to his plans.
Trump's remarks were at times noncommittal, using words like "we think" and "probably" rather than the formal language for policy specifics set in stone. Leavitt said written plans would be available to the public on Saturday.
The lack of concrete details added another layer of uncertainty to the tense conversation around trade between Canada and the United States — a complex issue that carries consequences for an untold number of people on both sides of the border.
Prime Minister Justin Trudeau has said Canada would have "a forceful and immediate response" to tariffs on Saturday.
"No one — on either side of the border — wants to see American tariffs on Canadian goods," he wrote on X.
The decision to impose tariffs stands to seriously harm both the diplomatic and economic relationships between the two countries, which are typically close allies. There are significant implications for major industries, like energy and automotive, that have long thrived under a variety of free trade agreements.
If Ottawa retaliates with its own tariffs as promised, it would amount to a trade war, which could mean higher prices and job losses nationwide.
CBC News has contacted the Prime Minister's Office for further comment.
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Earlier Friday, Leavitt dismissed a Reuters report that said tariffs would not begin until March 1.
"I saw that report and it is false," the press secretary said.
Trillion-dollar trade relationship
The trading relationship between Canada and the U.S. is enormous, to put it mildly. Roughly $3.6 billion worth of goods went back and forth over the border every day in 2023, according to Ottawa, making the relationship worth a trillion dollars a year.
Out of all the goods Canada exports to other countries, more than three-quarters goes to its southern neighbour. The automotive and agriculture sectors are key, but oil and gas lead the pack: Roughly 80 per cent of Canada's oil and 60 per cent of its natural gas go to the United States.
The move also means Canadian companies will have a harder time selling to American importers, since those importers will have to pay the tariffs. Canadian exporters will need to cut prices, and sacrifice profit, to offset the tax or try to find a patchwork of new buyers to make up for losing American business.
On Friday, Leavitt said Trump was moving for tariffs against Canada, Mexico and China because "fentanyl that has been seized at the southern border in the last two years alone has the potential to kill tens of millions of Americans."
Around 108,000 people in the U.S. died from drug-involved overdose in 2022, according to the U.S. Centers for Disease Control and Prevention (CDC). The organization said the number of people dying from drug overdoses in the U.S. has been dropping, declining by roughly 14 per cent from June 2023 to June 2024.
Ontario Premier Doug Ford has warned tariffs could cost up to a half-million jobs in his province, where the sprawling auto-assembly industry is closely linked to the U.S. Newfoundland and Labrador Premier Andrew Furey said Trump's move could cost thousands more jobs there, while B.C. Premier David Eby said a long-lasting trade war could cost nearly $70 billion in economic activity out west by 2028.
Trump sees tariffs — taxes one country places on another's foreign goods — as a way to protect American manufacturing and strengthen the wider economy. He has repeatedly said foreign countries pay tariffs when, in fact, they are paid by American importers.
Those companies then typically pass those costs onto their customers in the form of higher prices — which is why economists have warned it could ultimately be the public that pays the price in a tariff war.
When Trump initially threatened to impose the tariffs, he said they would be a response to what he called inaction by Canada and Mexico on illegal drugs and migrants entering the U.S., though officials have said less than one per cent of fentanyl or migrants entering the U.S. come from Canada.
Still, the Canadian government pulled together a $1.3-billion plan to boost security at the border in December to try to appease the incoming president. Prime Minister Justin Trudeau, who is in his final months of power, had promised "robust, rapid" and "very strong" retaliatory measures if Trump made good on his threats.
Trump also has said the tariffs are a way to put pressure over the United States' trade deficit with Canada, which he has incorrectly described as a subsidy. He has also said he would use economic force to turn Canada into the 51st state.
For decades, most goods have flowed tariff-free between Canada, Mexico and the United States because of free-trade agreements, the most recent of which were the Canada-U.S.-Mexico Agreement (CUSMA) and, its predecessor, the North American Free Trade Agreement (NAFTA). Even when American tariffs are in place for other countries, they're often far from 25 per cent — 2.5 per cent on passenger cars or six per cent on golf shoes, for example.
On Sunday, Colombia agreed to accept flights carrying deported migrants from the U.S. after Trump threatened to hit that country with its own set of tariffs for initially turning those flights away. The showdown served as a warning about the U.S. president's willingness to punish nations that interfere with his plans.
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With files from Reuters