President Trump on Thursday threatened to impose 35% tariffs on goods from Canada starting next month, hiking import duties on one of the U.S.’s largest trading partners.
The president announced the 35% tax in a letter to Canadian Prime Minister Mark Carney posted to Truth Social, citing Canada’s alleged “failure to stop the drugs from pouring into our country,” as well as retaliatory tariffs Canada has imposed on U.S. goods. The new tariffs are set to take effect Aug. 1, the president said.
The move is an escalation from the 25% tariffs on Canadian — and Mexican — imports announced by Mr. Trump shortly after taking office. He later exempted goods covered by the U.S.-Mexico-Canada Trade Agreement, which was negotiated during Mr. Trump’s first term. It’s unclear whether the same exemption will apply to next month’s 35% tariffs.
Mr. Trump has sent similar letters to the leaders of more than 20 other countries this week, telling them to expect higher tariffs starting next month. He told NBC News’ Kristen Welker on Thursday, “all of the remaining countries” will likely face tariffs of 15% to 20% — higher than the baseline 10% rate that’s currently applied to all countries.
But Canada is the largest American trading partner to receive a letter so far. Canada was the world’s largest buyer of American goods and the third-largest seller of goods to the U.S. last year, according to Census Bureau data. The country bought some $350 billion worth of American goods and sold $412 billion to the U.S. market in 2024.
Mr. Trump’s letter to Carney says he will “consider an adjustment to this letter” if “Canada works with me to stop the flow of Fentanyl.” For months, the president has cast tariffs against Canada and Mexico as a way of getting the U.S.’s two neighbors to stem illegal immigration and fentanyl trafficking, though very little fentanyl appears to enter the U.S. via Canada. Just 43 pounds were seized at the Canadian border last year, compared to 21,100 pounds at the Mexican border.
“Throughout the current trade negotiations with the United States, the Canadian government has steadfastly defended our workers and businesses,” Canadian Prime Minister Mark Carney wrote in a social media post late Thursday night. “We will continue to do so as we work towards the revised deadline of August 1. Canada has made vital progress to stop the scourge of fentanyl in North America. We are committed to continuing to work with the United States to save lives and protect communities in both our countries.”
The president also assailed Canada for “retaliat[ing] with its own Tariffs.” And he said Canada has imposed other barriers on U.S. imports.
Mr. Trump has held on-and-off discussions with Canada for months, but his relationship with the United States’ northern neighbor has occasionally been rocky, with U.S. tariffs drawing retaliatory duties from Canada. The president briefly called off all trade talks with Canada last month due to a planned digital services tax that could hit U.S. tech companies, but the talks resumed days later after Carney rescinded the tax.
Mr. Trump has also repeatedly mused about annexing Canada, and Carney’s party won this year’s parliamentary elections after the prime minister ran on a platform of defending Canada from the Trump administration’s ambitions.
Trump boosts tariffs on dozens of countries
The president is sending out this week’s spate of tariff letters about three months after first unveiling “reciprocal tariffs” against dozens of countries on “Liberation Day” in early April, along with a 10% tariff on everybody else. The move unnerved financial markets and sparked recession and inflation fears, and Mr. Trump quickly suspended most of the duties for 90 days — aside from the 10% baseline rate — saying he planned to negotiate trade deals.
With that 90-day pause set to expire this week, Mr. Trump began sending out letters to dozens of trading partners from Japan to South Africa informing them of their planned tariffs. The U.S. has trade deficits with most countries that received Mr. Trump’s letters, though Brazil was also threatened with a 50% tariff despite the U.S. running a trade surplus. The letter cited the prosecution of right-wing former Brazilian President Jair Bolsonaro, which Mr. Trump called a “Witch Hunt.”
On top of country-specific tariffs, the president has also imposed hefty “sectoral” tariffs on foreign steel, copper and other specific categories of goods.
Mr. Trump says the tariffs are necessary to revive American manufacturing and correct trade imbalances. But many economists warn that tariffs lead to higher consumer prices and slower economic growth. Federal Reserve Chair Jerome Powell has said concerns about tariffs are partly to blame for the central bank’s decision not to cut interest rates so far this year.
Still, the president has stood by his trade strategy.
“I think the tariffs have been very well-received,” Mr. Trump told NBC News on Thursday. “The stock market hit a new high today.”
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