Canadian Prime Minister Mark Carney placed counter-tariffs on U.S. vehicles that are not compliant with the United States-Mexico-Canada Agreement in response to President Donald Trump’s tariffs.
On Feb. 1, Trump announced 25% tariffs on most Canadian imports with exemptions for goods that fall under the USMCA. Those tariffs went into effect on March 4. The president’s separate 25% tariffs on foreign automobiles will likely have a severe impact on the U.S.’s northern neighbor.
Carney responded to those tariffs Thursday with retaliatory 25% levies on all U.S. vehicles not compliant with the USMCA agreement, which was negotiated during Trump’s first presidential term. Unlike Trump’s tariffs, Canada’s reciprocal tariffs will not target auto parts “because we know the benefits of our integrated production system,” the prime minister explained.
"We must respond with both purpose and force," Carney said of his “carefully calibrated and targeted counter-tariffs” during a news conference.
"All the money raised from these counter-tariffs will go directly to workers affected by the American tariffs," he said.
Carney said the U.S. remains an ally “in security and defense partnerships” but argued that Trump’s tariffs would "rupture" the global economy.
"While this is a tragedy, it is also the new reality. We must respond with both purpose and force. We are a free, sovereign, and ambitious country. We are masters in our own homes," he said.
Carney’s retaliatory tariffs followed steep counter-tariffs Trump placed on the vast majority of countries on Wednesday. Canada was among the few countries exempted from the “Liberation Day” tariffs, as Trump had already placed economic levies on it.
WHAT TO KNOW ABOUT TRUMP'S 'LIBERATION DAY' TARIFFS: HOW THEY WORK AND WHO THEY HIT
Ahead of the "Liberation Day" tariffs, the Senate passed a rare symbolic rebuke on Wednesday to revoke the emergency declaration Trump used to impose tariffs on Canada.
Ontario Premier Doug Ford said Wednesday that Canada would be willing to withdraw tariffs against the U.S. if Trump dropped his tariffs first. However, that appears unlikely, given Trump instituted the tariffs because he said Canada had not done enough to stop fentanyl from flowing across the border into the U.S. As recently as Wednesday, Trump suggested Carney is still not taking the aggressive action needed to assuage his concerns.