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Donald Trump has said the US will impose a 35% tariff on imports from Canada next month and threatened to impose blanket tariffs of 15% or 20% on most other trade partners.
In a letter released on his social media platform, Trump told Mark Carney, the Canadian prime minister, the new rate would go into effect on 1 August and would increase if Canada retaliated.
In March, Trump imposed a 25% tariff on cars and auto parts imported from Canada. In June, he announced a 50% tariff on Canadian steel and aluminum imports. The new rate would apply to all other goods.
Canada and the US are locked in trade negotiations in the hopes of reaching a deal by 21 July, but the latest threat seemed to put that deadline in jeopardy.
It was the latest of more than 20 such letters issued by Trump since Monday, as he continues to pursue his trade war threats against dozens of economies.
However the new tariff rates set by Trump this week could all be reduced to zero if the administration loses its appeal later this month of an adverse ruling by the US court of international trade, which found in May that the president had acted beyond his legal authority by using emergency powers to impose tariffs in the absence of an actual emergency.
That hearing at the US court of appeals for the federal circuit in Washington is scheduled for 10am local time on 31 July.
Canada and Mexico are both trying to find ways to satisfy Trump so that the free trade deal uniting the three countries – known as the USMCA – can be put back on track.
The United States-Mexico-Canada Agreement replaced the previous Nafta accord in July 2020, after Trump successfully pushed for a renegotiation during his first term in office. It was due to be reviewed by July next year, but Trump has thrown the process into disarray by launching his trade wars after he took office in January.
Earlier this year, Canadian and Mexican products were slapped with 25% US tariffs, with a lower rate for Canadian energy. Trump targeted both neighbours, saying they did not do enough on illegal immigration and the flow of illicit drugs across borders.
But he eventually announced exemptions for goods entering his country under the USMCA, covering large swaths of products.
Thursday’s letter to Carney comes despite continuing trade negotiations and what many had seen as warming relations between Trump and the Canadian prime minister. Carney came to the White House on 6 May and had a cordial meeting with Trump in the Oval Office.
After Trump called off trade talks last month due to Canada’s newly imposed digital services tax, Carney agreed to rescind the levy, which would have affected US tech firms.
Trump has broadened his trade war in recent days, threatening new tariffs on a number of countries, including allies Japan and South Korea, along with a 50% tariff on copper.
In an interview with NBC News published on Thursday, Trump said other trading partners that had not yet received such letters could face blanket tariffs.
“Not everybody has to get a letter. You know that. We’re just setting our tariffs,” Trump said in the interview.
“We’re just going to say all of the remaining countries are going to pay, whether it’s 20% or 15%. We’ll work that out now,” Trump was quoted as saying by the network.
