Canada starts collecting 15 to 50 percent duties on US$19.9 billion of American goods

At 12:01 a.m. on Tuesday, 8 September, Canada began collecting 15, 25 and 50 percent surtaxes on a list of United States goods covering about C$27.6 billion (US$19.9 billion) of annual imports. The duties match, dollar for dollar and rate for rate, the latest United States Section 338 and Section 232 tariffs that Washington placed on Canadian products from 22 August.

Finance Canada published the list on 25 August and trimmed it a day later after fishing and processing firms objected. Fish and seafood lines came off. What remains still runs to hundreds of tariff items. Steel and aluminium, already taxed in earlier rounds, move to 50 percent on most primary and fabricated forms. Dairy, furniture, clothing, cosmetics, plastics, paper, wood, appliances, electronics and agricultural machinery join the list at 15, 25 or 50 percent depending on the matching United States rate.

Goods already on the water or on a truck bound for Canada when the clock struck midnight are exempt. CUSMA-originating goods sit under a separate exemption in some lines, but the new package is the widest Canadian countermeasure since March 2025. Existing 25 percent duties on United States motor vehicles stay in force on their own track.

The political timing is blunt. Trade talks between Ottawa and Washington collapsed last week. The Carney government framed the reply as a test of whether a smaller economy can stand up to President Donald Trump and still keep its industrial base. Finance Minister Francois-Philippe Champagne, Industry Minister Melanie Joly, Jobs Minister Patty Hajdu and Artificial Intelligence and Digital Innovation Minister Evan Solomon announced a C$7.5 billion support package for workers and firms at the same time as the list.

The dairy lines are new in one important way. Canada is applying the surtax even on United States cheese, milk powder, whey and milk proteins that enter inside tariff-rate quota. Quota holders who used to pay little or nothing at the border now face 25 percent on fresh cheese and curd and 50 percent on powders and proteins. That change lands on processors who blend United States ingredients into Canadian products as well as on retailers who stock Wisconsin cheddar.

Steel and aluminium dominate the count. Legal summaries of the list put more than 300 of the 874 original line items in those two metals. Chapter 72 (raw and semi-finished steel) and Chapter 73 (fabricated steel, including screws, bolts, nuts and rail components) are almost entirely at 50 percent. Aluminium follows the same pattern from unwrought metal through foil and structures. Canadian mills that buy United States slab or coil to finish at home will pay more. So will builders who specify United States structural steel.

Furniture and apparel are the most visible items for households. Upholstered seating, wooden and metal furniture, and a wide range of clothing and footwear now carry 50 percent. Cosmetics, including skincare and perfume, sit at the same rate. Air-conditioning machines are at 25 percent. Forklifts, lawnmowers and harvesting machinery are at 50 percent. Hand tools, including some used in veterinary and dental work, are at 25 percent.

Ottawa says the list targets the sectors most hurt by the United States measures. That is a political claim and also a practical one. Canadian steel and aluminium exporters have already lost margin in the United States. The counter-tariff is meant to raise the price of the competing United States product inside Canada and to give Ottawa a bargaining chip. Whether it works depends on how easily Canadian buyers can switch to domestic or third-country supply. For cheese and furniture the switch is often possible. For specialised agricultural equipment and some steel grades it is slower.

Washington has other levers. President Trump this week threatened a sales ban on Bombardier, the Canadian planemaker. That threat is separate from the tariff schedule but it sits in the same file. Canadian officials have spent the past ten days telling importers to check Harmonized System codes against the Finance Canada list rather than guess from product names. A sofa and a steel fastener do not look alike. Both can now cost half as much again at the border.

The first legal test will be classification disputes at the Canada Border Services Agency. Importers will argue origin, valuation and whether a part is a steel derivative. The government has said more administrative guidance is coming. Until that guidance is posted, firms are pricing invoices with the published rates and applying for remissions where the list allows them.

For consumers the effect will not show up in one week. Inventories bought before Tuesday will clear first. By October, shelf prices on United States dairy, furniture and small appliances should start to move if retailers pass the duty through. The larger question is whether the two governments reopen talks before the next scheduled political event in Washington hardens the United States position again.

Canada has chosen a matching list rather than a symbolic one. That choice raises costs at home in order to put costs on the other side of the border. Tuesday is the day those costs became payable.