President Donald Trump has announced a 35 per cent tariff on Canadian exports to the United States, effective August 1, 2025, intensifying trade tensions between the two neighboring countries. The announcement was delivered in a formal letter to Canadian Prime Minister Mark Carney on Thursday, marking the latest move in Trump’s ongoing trade offensive targeting over 20 global economies.
Canada and the United States have been engaged in fraught negotiations to salvage their trade relationship ahead of a previously agreed July 21 deadline. However, Trump’s latest tariff warning appears to have pushed both sides toward a new target date of August 1.
In a statement posted on X (formerly Twitter) Thursday night, Prime Minister Carney reaffirmed Canada’s commitment to protecting its economy. “Throughout the current trade negotiations with the United States, the Canadian government has steadfastly defended our workers and businesses. We will continue to do so as we work towards the revised deadline of August 1,” Carney said.
The tariff dispute threatens to derail the United States-Mexico-Canada Agreement (USMCA), which replaced the decades-old NAFTA pact in July 2020 following a push for renegotiation by Trump during his first term. The trade deal had been scheduled for review by mid-2026, but ongoing tariff battles and political disagreements have disrupted the process.
Canadian and Mexican exports were previously hit with 25 per cent US tariffs, with Canadian energy products receiving slightly lower rates. Trump justified the sanctions by accusing both neighbors of failing to curb illegal immigration and the trafficking of illicit drugs, notably fentanyl, across US borders — a claim contradicted by official data showing Canada contributes less than one per cent to the US’s illicit fentanyl supply.
Though exemptions for certain goods under the USMCA remain intact, Bloomberg reported Thursday that the US administration has no current plans to adjust these exclusions.
The tariff threat comes despite what had been improving personal ties between Trump and Carney. The two leaders last met during a cordial Oval Office visit in May, followed by discussions at last month’s G7 summit in Canada, where fellow world leaders pressed Trump to ease his aggressive trade stance.
Meanwhile, Trump also revealed in an NBC interview plans to impose blanket tariffs of 15 to 20 per cent on other countries yet to receive his tariff warning letters, starting August 1. Brazil, in particular, is facing a potential 50 per cent tariff unless a trade deal is reached before the deadline. Brazilian President Luiz Inácio Lula da Silva responded Thursday, expressing a willingness to negotiate while signaling his government’s readiness to implement reciprocal measures if necessary.
Trump’s escalating trade threats risk deepening global economic uncertainty as governments scramble to secure favorable terms and protect key export industries.
