Trump's Tariff Letter Hits Canada With 35% Duties, Threatens More If Ottawa Retaliates

In a major escalation of his protectionist trade policy, US President Donald Trump on Friday declared that the United States will apply a 35 per cent tariff on all Canadian imports effective August 1, 2025. Trump explained that the action is intended to pressure Ottawa to collaborate with Washington on stopping the flow of fentanyl into the US and halting what he called "unfair" trade practices. The statement was made through a letter to Canadian Prime Minister Mark Carney, which was made public by Trump on his social media site, Truth Social. In the sharply worded letter, Trump accused Canada of not stopping drugs from entering the US and retaliating against previous American tariffs with tariffs of its own.

Tariff Threat Tied to Fentanyl and Dairy Dispute

“As you will recall, the United States imposed Tariffs on Canada to deal with our Nation’s Fentanyl crisis, which is caused, in part, by Canada’s failure to stop the drugs from pouring into our Country. Instead of working with the United States, Canada retaliated with its own Tariffs,” Trump mentioned in his letter. He also threatened that any further tariffs levied by Canada would be answered with an equal raise in US tariffs. "If for any reason you choose to raise your Tariffs, then, whatever number you decide to raise them by, will be added to the 35% that we charge," he wrote. Trump also targeted Canada's high tariffs on US dairy imports, which he called "extraordinary" ranging as high as 400 per cent in certain instances, and characterised the deficit as a threat to American national security. Trump said Canadian companies could avoid the new duties if they move their manufacturing operations to the US. “Goods transshipped to evade this higher Tariff will be subject to that higher Tariff. There will be no Tariff if Canada, or companies within your Country, decide to build or manufacture product within the United States,” he stated.

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As part of a wider trade clampdown, Trump has also imposed new tariffs on imports from Brazil and seven other countries. Brazil will be hit with a 50 per cent tariff from August 1, Sri Lanka, Iraq, Algeria and Libya will be hit by a 30 per cent duty. Imports from Moldova and Brunei will incur a 25% tariff, and those from the Philippines will be subject to a 20% charge. He also shared similar letters to the leaders of these nations on Truth Social, indicating that the tariffs may be increased further if the subject countries impose retaliatory measures.

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Earlier this week, Trump announced that his administration had already dispatched letters to 14 other countries, including Japan, South Korea, Malaysia, Indonesia and Bangladesh, informing them of the same tariffs. All of the duties will become effective on August 1, 2025, with no exceptions or extensions. Trump penned, "TARIFFS WILL BEGIN BEING PAID ON AUGUST 1, 2025. No change to this date has occurred, and no change will occur. All funds will be due and payable beginning AUGUST 1, 2025 — No extensions will be made." In addition to country-specific obligations, the US President has also suggested across-the-board tariffs of 15 per cent to 20 per cent on "most other trading partners," in consonance with his America First policy. The sweeping tariffs occur at a time when Trump's administration is already holding delicate trade negotiations with important allies, such as India. The India-US trade negotiations are reported to be advanced, even as other allies such as Japan and South Korea prepare for the effect of the new tariffs.