Canada's plan for retaliatory tariffs on the US

Canada's retaliatory tariffs on the US, in response to tariffs imposed by the Trump administration, took effect on Tuesday morning.

US President Donald Trump earlier said the US would proceed with 25% tariffs on Canadian and Mexican goods and 10% duties on Canadian energy products from March 4 after a one-month reprieve expired.

On Monday, Prime Minister Justin Trudeau said tariffs on C$30bn (R385.72bn) of US imports would take effect immediately and more tariffs could follow. The retaliation amount was the same as in the February announcement, though he did not give details on which goods would be affected.

Details of the plan Canada announced last month:

RETALIATORY TARIFFS

Canada will impose 25% tariffs on C$30bn in goods imported from the US effective immediately. The duties will remain in place until the US eliminates its tariffs against Canada. The counter measures do not apply to goods already in transit.

The C$30bn is part of an overall retaliatory measure targeting C$155bn (R1.99-trillion) worth of goods imports from the US, with the remaining C$125bn (R1.6-trillion) coming into force after a 21-day consultation period.

PRODUCTS

The first tranche of retaliation includes a list of 1,256 products such as orange juice, peanut butter, wine, spirits, beer, coffee, appliances, apparel, footwear, motorcycles, cosmetics and pulp and paper.

The cost of imports associated with some of the major products are cosmetics and body care worth C$3.5 (R45.03bn), appliances and other household items worth C$3.4bn (R43.73bn), pulp and paper products of C$3bn (R38.59bn) and plastic products worth C$1.8bn (R23.15bn), among others.

SECOND TRANCHE

The government will be consulting the public and stakeholders for a second tranche of retaliatory tariffs which will include a wide range of products imported from the US such as passenger vehicles and trucks, electric vehicles, steel and aluminium products, fruits and vegetables, aerospace products, beef, pork and dairy.

NON-TARIFF MEASURES

Trudeau has also said Canada is considering non-tariff retaliatory measures potentially relating to critical minerals, energy procurement and other partnerships. His energy minister has said an export tariff on critical minerals is one option.

SUPPORT

The government will also take steps to mitigate the impact of its tariff countermeasures on Canadian workers and businesses, the finance ministry has said.

It will establish a remission process to consider requests for relief from the tariffs imposed as part of Canada's immediate response, as well as any future tariff actions, it said.

Reuters