Listeners, welcome back to Canada Tariff News and Tracker, your focused look at how Washington’s trade moves are reshaping Canada’s economy.

According to The Straits Times and Reuters, U.S. President Donald Trump has now **increased tariffs on most Canadian goods outside the USMCA to 35 per cent, up from 25 per cent**, under a sweeping executive order signed July 31. These higher duties hit Canadian exports that are not fully compliant with the US‑Mexico‑Canada Agreement, with especially sharp pressure on lumber, steel, aluminum, and autos.

The White House is branding this the “fentanyl tariff,” arguing that Canada has failed to do enough to stop cross‑border flows of the drug, even though, as Mark Carney’s government notes, Canada accounts for only about 1 per cent of U.S. fentanyl imports and has already tightened controls. The order goes further: a transshipment levy of **40 per cent** will apply to Canadian goods routed through third countries in an attempt to dodge the new rate, according to the same White House fact sheet reported by The Straits Times.

A running Trump 2.0 tariff tracker from the Trade Compliance Resource Hub describes this Canada measure as part of a broader “fentanyl” tariff regime: **0 per cent for USMCA‑duty‑free goods, 10 per cent on potash, and now 35 per cent on almost everything else**, with the administration having floated additional increases this fall. That structure is pushing Canadian firms to maximize USMCA compliance or shift production and markets away from the U.S.

The economic fallout is already visible. Canadian government data cited by The Straits Times shows the share of Canadian exports going to the U.S. fell by about 10 percentage points, down to 68 per cent between May 2024 and May 2025, as manufacturers, especially in autos and metal‑intensive products, scramble to diversify. Ontario Premier Doug Ford has publicly urged Ottawa to respond with **counter‑tariffs of up to 50 per cent** on U.S. steel and aluminum, signaling that a full‑blown bilateral trade war is now a live risk.

At the same time, the National Post reports that Carney has quietly scrapped Canada’s planned 3 per cent digital services tax after Trump threatened to halt trade talks if it went ahead. Trade experts quoted in that piece argue that while rolling back the DST may spare Canada another front in this tariff conflict, it has not bought much goodwill in Washington, where tariffs remain the administration’s go‑to tool for leverage.

For Canada, this moment is about more than tariff percentages. It is about whether a highly integrated, export‑driven economy can weather a prolonged period in which its largest trading partner uses border taxes as a primary instrument of foreign and domestic policy.

Thanks for tuning in to Canada Tariff News and Tracker. Be sure to subscribe so you never miss an update. This has been a quiet please production, for more check out quiet please dot ai.

For more check out https://www.quietperiodplease.com/

Avoid ths tariff fee's and check out these deals https://amzn.to/4iaM94Q

This content was created in partnership and with the help of Artificial Intelligence AI