The Trump administration announced a new suite of trade measures on dozens of countries Wednesday. And if the new rules have your head swimming, you’re not alone.
In short, Canada was spared the worst of it, but the current measures will still have massive implications for this country and the rest of the world.
Here are answers to some frequently asked tariff questions.
U.S. President Donald Trump announced sweeping new tariffs on most of the world in front of a crowd gathered at the White House’s Rose Garden, for a day he’d been calling “Liberation Day” in the lead-up to the event.
The president said he would apply “a minimum baseline tariff of 10 per cent” on all goods coming into the U.S., which will go into effect on April 5. For countries that he says rip off the U.S. the most, that number climbs. Those “worst offender” tariffs come into play on April 9.
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All of it was detailed on a large chart, broken down by country, which the president used to articulate his message to the crowd.
Canada and Mexico were both exempt from that 10 per cent figure, and any further tariffs.
No — there are just no new ones.
Aluminum and steel going from Canada into the U.S. were already being tariffed at 25 per cent before today. Those tariffs will continue.
A 25 per cent tariff on all foreign made cars — including Canadian ones — also goes into effect today. This measure was one we saw coming, given the White House announced those details in late March.
Yes, because nothing can be simple in a trade war.
Goods that are compliant with the Canada-United States-Mexico Agreement (CUSMA) will see no tariffs, but those that are not will be taxed at 25 per cent. Non-CUSMA compliant energy and potash would see a lower 10 per cent tariff.
The White House also said importers who bring cars into the U.S. under CUSMA will be given the opportunity to certify their U.S. content. The 25 per cent tariff would then only apply to the parts of the car that are not American-made.
Broadly, Asia was hit hard by new tariffs. China got a 34 per cent rate, Vietnam will pay a 46 per cent rate, Thailand’s was 36 per cent and Cambodia’s was 49 per cent, to name a few.
Many Latin American countries — like Colombia, El Salvador and Argentina — are being taxed at 10 per cent.
The European Union also received a 20 per cent tariff rate on all goods.
Lesotho and Saint Pierre and Miquelon, a small group of French islands off the coast of Newfoundland, have the highest tariff rates at 50 per cent.
Trump has called these “reciprocal tariffs,” meaning that the U.S. doing to others what they believe is being done to them.
A truly reciprocal tariff would simply match what other countries charge U.S. importers to bring goods into the country. For example, if Canada were to put a five per cent tariff on wine coming into the country from the U.S., a reciprocal tariff would see the U.S. impose a five per cent tariff on Canadian wine as well. Many of these new, blanket levies are not reciprocal tariffs.
The president claimed again yesterday that the U.S. “subsidizes” many other countries by allowing them to send more of their goods to the U.S. than the U.S. sends to them.
For example, he’s often repeated that the U.S. subsidized Canada to the tune of $200 billion a year. This is false, however — the figure for 2024 was $63.3 billion US. And that number is actually the trade deficit between the two countries, meaning that the U.S. buys more from Canada than we buy from them.
The president has also said that these measures will bring back manufacturing to the U.S. — something he claims would “make America rich again.”
The administration has also cited a drug and migrant emergency at the border as justification for its tariffs on Canada, though, again, the validity of that claim has been disputed. The White House has used a national emergency declaration to put tariffs on Canada so far.
The White House said yesterday that if that emergency were to disappear, then the tariff on goods that do not comply with USMCA will fall from 25 per cent to 12 per cent.
Yes. Canada first imposed 25 per cent tariffs on $30 billion worth of U.S. goods on March 4. Another $29.8-billion worth of American goods were slapped with that same 25 per cent on March 13.
Prime Minister Mark Carney announced another 25 per cent tariff on Thursday, this time on all cars coming to Canada from the U.S. This matches the massive automotive tariffs coming into force by the U.S. today.
It’s expected to have a devastating impact.
Already today, the Stellantis assembly plant in Windsor, Ont., says they’re halting operations for two weeks, largely because of these tariffs on the automotive industry. A spokesperson for Stellantis said about 3,200 Canadians would be impacted by the closure.
Brian Kingston, president and CEO of the Canadian Vehicle Manufacturers’ Association, says the North American vehicle industry operates on a “just-in-time” model, meaning parts arrive at factories just before you need them. It helps the industry be efficient — but it’s also why the impacts are being felt so suddenly.
He adds that these tariffs will drive up costs for carmakers, which will be passed on to consumers and will ultimately mean less people will buy, resulting in less production at factories. Economist and professor Colin Mang told CBC earlier this week that tariffs could increase the sticker price of a new car by thousands of dollars.
Kingston says the carveout for cars based on how much of them are made by American parts is positive — upwards of 50 per cent of a car that’s assembled in Canada might have parts made in the U.S., so that will considerably lower the 25 per cent tariff.
But he adds that he doesn’t want to sugarcoat the situation — he says it’s still a “significant cost,” just one that’s slightly less than what their European or Asian competitors will be facing.
Yes. The North American auto industry is massively intertwined. Some parts cross borders between Mexico, Canada and the U.S. a handful of times before ending up in a car.
Canada and the U.S. signed an Auto Pact in 1965 and have worked together since then to build a singular auto industry that would be as efficient and affordable as possible.
Stellantis idles plant in Windsor, Ont., for 2 weeks because of U.S. tariffs
The Stellantis spokesperson said that assembly plants in both Canada and Mexico will be idling temporarily. The company also said 900 employees at U.S. plants will be temporarily laid off, though no plants there will stop production.
Outside of North America, German carmaker Volkswagen also said they’ll be charging an import fee on all cars hit by the 25 per cent tariff from the U.S. They’ve also halted shipments of vehicles from Mexico to the U.S. by train and say that cars arriving from Europe by ship will stay in ports, according to the Wall Street Journal.
Overall, these tariffs will see costs rise and they will impact the global order as we know it.
Eric Miller, head of the Rideau Potomac consultancy in Washington, said this will mean less international trade will take place worldwide, which will reduce consumer choice and hurt people’s incomes across the globe.
Trump’s goal is also to shift where manufacturing takes place, bringing it from overseas back to the U.S. But relocating those kinds of facilities takes a long time and lots of money. Given the stop-and-start nature of the new U.S. administration’s tariff policy so far, trade expert Chad Bown told CBC he’s not sure companies will want to make those massive changes just yet.
Punitive actions toward the U.S. are likely to follow, too, according to Miller, as other countries seek to fight back at Trump’s tariffs. This will further drive a wedge into the U.S.’s relationship with other Western countries like the U.K. and Australia, he says.
“It will underscore to these traditional allies that the United States is not a quote-unquote reliable ally that can be counted on and trusted,” Miller told the CBC’s Front Burner.
Miller says these changes bring an abrupt halt to the way the world tends to do business.
“You have seen essentially an unmaking of the economic model that the world and North America have pursued since the mid-1980s, where there is less economic interdependence, there’s less international trade. There’s less openness to international trade,” Miller said.
And Miller says that world order could never go back to the way it was before Wednesday.
