U.S. President Donald Trump has postponed new 50% tariffs on about US$20 billion in Canadian goods for three days as Canadian and U.S. officials work to complete a trade agreement.
The tariffs were scheduled to take effect at 12:01 a.m. Aug. 19. Trump announced the pause late Aug. 18, saying on social media that Canada and the United States, “subject to the finalization of documents, have a DEAL!”
The duties stem from three measures Trump announced in July under Section 338 of the U.S. Tariff Act of 1930. Washington cited Canadian measures affecting U.S. dairy products, alcoholic beverages and motor vehicles. The new tariffs are separate from existing U.S. Section 232 duties on Canadian vehicles, steel and aluminum.
Prime Minister Mark Carney said following his conversation with Trump that “substantial progress has been made, although there is important work still to be done.” On Aug. 19, Carney said on social media that Canada was “moving towards an agreement that reinforces that Canadian advantage,” including improved terms for strategic sectors and greater certainty in the trading relationship.
Trump told reporters Aug. 19 that the countries had “come to a deal” and said Canadian representatives had given Washington “the points we had to have.” He also claimed Canadian tariffs on U.S. agricultural products would be eliminated. Canadian officials have said the country's dairy supply-management system will remain in place.
The negotiations also cover existing sectoral tariffs. Public reporting indicates discussions include reducing the U.S. tariff on Canadian vehicles from 25% to 15% and cutting steel and aluminum tariffs from 50% to 25%. Those terms had not been formally announced by either government as of Aug. 19.
