The Canadian federal government has quietly eliminated more retaliatory tariffs on American goods than previously disclosed, as per an order-in-council made public online. Despite Prime Minister Mark Carney’s commitment to removing counter-tariffs on U.S. products covered by the Canada-U.S.-Mexico Agreement (CUSMA) in August, the recent notice indicates that most Canadian retaliatory tariffs have been lifted, except for specific sectors like steel, aluminum, and auto industries.
While the prime minister’s announcement seemed to mirror the U.S.’s actions towards Canada, trade experts have noted that the Canadian policy is not entirely reciprocal. William Pellerin, an international trade lawyer, suggested that there might have been a political motive to appear more quid pro quo in the decision-making process.
Carney’s announcement on August 22 was followed by the official government notice on August 29, raising questions about when the policy shift occurred. The potential revenue from counter-tariffs on non-CUSMA-compliant goods is estimated to be minimal and likely insufficient to cover the costs of enforcing these tariffs at the Canada Border Services Agency.
The decision to eliminate non-sectoral counter-tariffs has been viewed as a strategic move to reduce compliance burdens and costs. While most goods crossing the border can be made CUSMA compliant, meeting the necessary criteria and paperwork requirements has been described as cumbersome by trade experts.
A spokesperson for Finance Minister François-Philippe Champagne emphasized the government’s priority of advancing trade negotiations with the U.S. to protect Canadian workers and industries. Conservative Leader Pierre Poilievre criticized the government’s trade approach, accusing the prime minister of conceding too much to the U.S. without receiving adequate benefits in return.