On July 11, 2025, US President Donald Trump announced that starting from August 1, the United States will impose a 35% tariff on all imported goods from Canada and is planning to impose comprehensive tariffs of 15% to 20% on other countries that have not yet reached a trade agreement. This decision is a significant escalation in the ongoing trade tensions between the US and its trading partners.
In a letter addressed to Canadian Prime Minister Mark Carney posted on social media on Thursday evening, Trump stated that the 35% tariff would be separate from the existing industry tariffs on steel, aluminum, automobiles, and other sectors known as Sectoral Tariffs. Trump warned that if Canada retaliates against US actions, the tariffs could be further increased.
One of the main reasons cited by Trump for the imposition of tariffs on Canadian goods is Canada’s failure to effectively prevent the flow of fentanyl into the United States. However, some US media outlets have pointed out that the majority of fentanyl entering the US comes from the southern border and that the amount of drugs entering through Canada is relatively small.
Canada is one of the most significant trading partners of the United States. According to data from the US Department of Commerce, Canada imported goods worth $349 billion from the US last year, while its exports to the US reached a value of $413 billion, making it the third-largest foreign source of goods for the US.
The decision to impose tariffs on Canadian goods has the potential to trigger retaliatory tariffs from Canada, which could impact US export industries. Following the announcement, the Canadian dollar depreciated by approximately 0.3% against the US dollar.
Trump also revealed that countries that have not received trade letters or have not reached agreements will face a “comprehensive tariff” of 15% to 20%. In an interview with Kristen Welker, the host of NBC News’ “Meet the Press” on Thursday, Trump stated, “We will announce directly that all the remaining countries have to pay, whether it’s 20% or 15%, we will handle it right now.”
The Trump administration has already issued similar tariff letters to leaders of over 20 countries, warning of tariffs to be imposed from August 1, in an effort to expedite trade negotiations with the US.
This move by the US administration signals a shift towards a more aggressive trade policy, aiming to renegotiate trade terms with multiple countries and potentially reshaping global trade dynamics in the coming months. The implications of these tariff actions remain uncertain, but they underscore the growing tensions in international trade relations.