Canada’s retaliatory tariffs on US goods take effect

Canada imposed retaliatory tariffs on CAN$27.6 billion ($20 billion) worth of US goods early Tuesday, escalating a trade war between the neighboring countries.

The countermeasures, which took effect at 12.01 a.m. local time (0401GMT), match US Section 338 tariffs "dollar for dollar."

Ottawa is imposing 15%, 25% and 50% tariffs on US imports, targeting key sectors including steel, dairy, appliances, agricultural equipment, pulp and paper and electronics.

The escalation follows the collapse of bilateral trade talks in late August, which prompted the administration of US President Donald Trump to impose 50% tariffs on key Canadian goods. The US measures targeted steel, aluminum, lumber and automotive components under Section 338, a US trade provision that empowers the president to impose retaliatory trade barriers.

Canada clarified that the counter tariffs only apply to goods originating from the US and will not affect shipments already in transit on the day of implementation.

The trade dispute has intensified dramatically under the Trump administration, with successive rounds of import taxes and retaliatory measures.

Trump has repeatedly criticized the Canada-US trade gap, pointing to it as a core reason for imposing tariffs and regularly alleging that Ottawa is "ripping off" America.