EL7.AI
Macro EconomyMediumUpdated×4•Originally published 23 October 2026•Updated 24 October 2026•
4 min read

Trump reshuffles 50% tariffs on $20 billion of Canadian imports

Key Facts

1The 50% tariffs cover Canadian products worth $20 billion, according to The Associated Press.
2Product additions and removals take effect on October 30, 2026.
3Section 338 authorizes additional tariffs capped at 50%.
4Canada imposed tariffs ranging from 15% to 50% on U.S. products.

U.S. President Donald Trump signed a new change on October 23 to the scope of additional 50% tariffs on Canadian products, covering imports worth $20 billion, with the list changes set to take effect on October 30. The decision removes plywood panels, some paper products, machinery, refrigeration equipment and packing boxes from the tariffs, and adds some valves, carpets, waste products and other goods. The measure reshuffles the goods covered without announcing a change to the tariff rate on products that remain subject to it. The White House said the tariffs are based on Section 338 of the Tariff Act of 1930. The change comes as U.S. companies and farmers say some Canadian inputs are difficult to replace or are not available domestically.

The text of Section 338 allows the president to impose additional tariffs of up to 50%, and authorizes him to suspend, revoke, supplement or amend proclamations issued under it whenever he deems the public interest requires it. According to the sequence of presidential proclamations, the suspension of the tariffs ended on August 22, after which Trump amended their scope on September 8 before issuing the latest change. The tariffs apply to all covered goods whether or not they meet the rules of origin under the United States-Mexico-Canada Agreement, and are added to tariffs imposed under Section 232. The White House said the measure is intended to counter what the administration views as Canadian discrimination against U.S. exports of dairy, alcohol and automobiles. In the list change, Trump added products including carpets, paints, waste, shampoo and cocoa powder, according to Reuters.

Republican Senator Susan Collins said she had spoken with U.S. Trade Representative Jamieson Greer and Commerce Secretary Howard Lutnick about the tariffs' impact on Maine families, businesses, farmers and producers. She sought exemptions for some equipment, packing materials and Canadian products that "are not available from American suppliers or cannot be replaced without incurring significant costs." Collins welcomed the relief, saying it would help the state's blueberry, potato, apple and seaweed producers. She also called for further relief and encouraged a broader trade deal with Canada, which she described as the United States' largest trading partner. Collins is in a close re-election race against Democrat Troy Jackson, according to The Associated Press.

The cost of the tariffs falls on U.S. importers, who face the choice of passing the increase on to their customers or absorbing it themselves, according to The Associated Press. In one aspect of the trade tensions, Canada imposed tariffs ranging from 15% to 50% on U.S. products, the agency reported. Trump announced a ban the previous month on nearly $1 billion in Canadian imports, including alcoholic beverages, dairy products and motorcycles. In the context of pressure related to prices, an AP-NORC poll conducted between September 24 and 28 among 2,140 U.S. adults found that 65% blamed Trump's policies for prices remaining high, more than factors beyond his control. This adds to domestic debate over the cost of tariffs for businesses and consumers.

The tariffs also face a legal challenge from Gellert Global Group, a New Jersey food importer that imports Canadian cheese, which sued in the U.S. Court of International Trade to challenge Trump's authority to impose 50% tariffs on $20 billion worth of Canadian goods. The Associated Press said Section 338 has not been used in a trade dispute or tested in court. The White House said it would vigorously defend the tariffs, arguing that Section 338 is appropriate to counter what the administration describes as Canadian discrimination against U.S. exports of dairy, alcohol and automobiles. On the Canadian side, Trade Minister responsible for relations with the United States Dominic LeBlanc said Ottawa was assessing the latest change. He added that Canada was ready to work "in good faith and constructively toward a more mutually beneficial trade relationship that respects Canada's interests."