The White House says U.S. President Donald Trump has signed an executive order to increase a tariff on Canadian goods to 35 per cent.
In a statement issued Thursday evening, the White House said the new tariff rate, set at 25 per cent since March, will rise effective Friday.
“Canada has failed to co-operate in curbing the ongoing flood of fentanyl and other illicit drugs, and it has retaliated against the United States for the president’s actions to address this unusual and extraordinary threat,” says the statement.
However, Canadian goods that meet the terms of the Canada-U.S.-Mexico Agreement will not be subject to the tariff, which means the vast bulk of Canada’s exports can still cross the border tariff-free.
In a separate executive order on Thursday, Trump hit dozens of countries around the world with new across-the-board tariff rates ranging from 15 to 41 per cent.
After speaking with Mexican President Claudia Sheinbaum, Trump gave Mexico a 90-day extension of its current tariff regime, despite having previously threatened to raise the rate effective Friday.
Speaking from the White House on Thursday, U.S. President Donald Trump said Canada’s plan to recognize Palestinian statehood in September would not stop the ongoing trade negotiations, with his Aug. 1 deadline hours away.
Earlier Thursday, Trump said he had not spoken with Prime Minister Mark Carney during the day.
Speaking to reporters at the White House, Trump was asked whether Carney’s announcement that Canada plans to recognize a Palestinian state was a deal-breaker on trade.
“I didn’t like what they said, but you know, that’s their opinion,” Trump said. “Not a deal-breaker. But we haven’t spoken to Canada today. He’s called and we’ll see.”
PM’s office not commenting
Carney’s office would not confirm that a call was placed to the White House, and told CBC News it is not confirming any details about the ongoing negotiations.
Canada’s trade negotiating team is in Washington, but officials were tight-lipped Thursday about who they were meeting with — if anyone.
Ontario Premier Doug Ford called the tariff increase concerning and said Ottawa should retaliate with 50 per cent tariffs on U.S. steel and aluminum.
“Canada shouldn’t settle for anything less than the right deal,” Ford said on the social media platform X. “Now is not the time to roll over. We need to stand our ground.”
For more than a week, Carney and other Canadian officials have been downplaying the likelihood of getting a deal by the deadline. They’ve also cast doubt on the urgency, given the exemption that allows roughly 90 per cent of Canadian exports to enter the U.S. tariff-free.
David Paterson, Ontario’s representative in Washington, told CBC’s Power and Politics guest host David Common that Canadians should not be overreacting to the lack of a deal right now.
“The sun will shine in the morning and we will carry on,” Paterson said Thursday from his office in Canada’s embassy in Washington.
“We really support the prime minister’s approach,” Paterson said. “When the time is right for that agreement to come together, it will.”
Comments from U.S. officials
White House press secretary Karoline Leavitt suggested earlier Thursday that the threatened tariff increases would kick unless Trump reached last-minute deals with trading partners.
“Those countries that either do not have a deal or have a letter, they will be hearing from this administration by the midnight deadline tonight,” Leavitt told reporters in a briefing.
WATCH | Canadians’ boycott of U.S. booze draws attention south of the border:
The U.S. liquor sector is putting economic and political pressure on the Trump administration as the Canada-U.S. trade deal deadline approaches. They hope the administration might offer limited carve-outs to their industry or rethink tariffs altogether.
Trump’s Commerce Secretary Howard Lutnick suggested Thursday that Trump will follow through with his threat to raise the tariff rate on Canadian imports.
“I just don’t see the president stepping off the gas,” Lutnick said in an interview on Fox Business Network, during which he criticized Canada for being one of the only countries to retaliate against Trump’s tariffs.
Other deals, and a lawsuit
Trump issued similar ultimatums with the same Aug. 1 deadline to 17 major trading partners across the globe, including Canada, Mexico, the European Union, Japan and Taiwan. Each contained threats of tariffs in the range of 30 per cent.
Last week, Trump announced deals with the EU and Japan with across-the-board tariffs of 15 per cent as well as vague commitments for hundreds of billions of dollars of investment in the U.S.
Separately, Trump has imposed a 50 per cent tariff on steel and aluminum imports from around the world. Canada is the top supplier of both products to the U.S.
For the tariff that specifically targets Canada, Trump used a law that allows the U.S. president to take emergency economic measures to “deal with any unusual and extraordinary threat” to national security. He cited the supposed flow of fentanyl across the country’s northern border as that threat.
That tariff is facing a legal challenge that has now reached a federal appeals court, putting it further along in the U.S. court system than any other tariff lawsuit.
