OTTAWA, Canada – The Canadian government is responding to recently imposed U.S. tariffs that threaten to disrupt the international trading system. While key aspects of the Canada-U.S. trade relationship remain intact, new tariffs targeting automobiles have now been implemented, adding to existing tariffs on steel and aluminum.
These U.S. tariffs are expected to negatively impact American businesses and workers while also affecting Canadians. The Canadian government has committed to vigorously opposing these measures to protect its workforce and strengthen its economy as the strongest in the G7.
Prime Minister Mark Carney has unveiled a set of countermeasures aimed at shielding Canadian workers and businesses from the consequences of U.S. tariffs, reinforcing Canada’s economic integrity.
The countermeasures include:
- Implementing 25% tariffs on fully assembled vehicles not compliant with CUSMA that are imported from the U.S.
- Imposing 25% tariffs on non-Canadian and non-Mexican content of CUSMA-compliant vehicles imported from the U.S.
- Developing a strategic framework to incentivize auto production and investment within Canada.
Crucially, all revenue generated from these tariffs will directly support Canadian auto workers.
These initiatives enhance previously announced support for Canadian workers and businesses, which includes:
- Waiving the one-week employment insurance (EI) waiting period.
- Suspending separation rules for six months to ensure workers can access EI without exhausting severance pay.
- Increasing accessibility to EI by raising regional unemployment thresholds.
- Deferring corporate income tax payments and GST/HST remittances from April 2 to June 30, 2025, resulting in up to $40 billion in liquidity for businesses.
- Launching a new financing program for businesses.
- Providing additional funding for regional development agencies to better assist local businesses.
In challenging times, unity and decisive action are paramount, and the Canadian government is fully committed to this course.
“The global economic landscape has transformed, and we must respond decisively to protect Canadian workers and businesses from these unjust tariffs. Our commitment to defending the interests of Canadians and striving for the strongest G7 economy is unwavering,” stated Prime Minister Mark Carney.
Quick facts:
- Canada and the United States share a robust trading relationship that supports millions of jobs, with US$2.5 billion in goods and services crossing the border daily.
- On March 4, 2025, U.S. tariffs of 25% on Canadian goods and 10% on Canadian energy and potash exports took effect, followed by a 25% tariff on Canadian steel and aluminum on March 12, 2025.
- Starting April 3, U.S. tariffs of 25% on Canadian automobiles commenced, impacting over 500,000 Canadians connected to the auto industry.
- Additional U.S. tariffs on certain auto parts are set to be introduced by May 3, with specific exclusions potentially available for U.S. content.
- In retaliation, Canada has enacted a range of countermeasures targeting $30 billion in U.S. imports effective March 4, 2025.
