April 25, 2025 8:42 pm
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Canada Imposes 25% Tariff on U.S. Vehicles in Response to Trump’s Trade Policy

Canadian Prime Minister Mark Carney has announced a 25% export tariff on all types of U.S. vehicles, in response to U.S. President Donald Trump’s recent trade policies. The announcement was made through a post on the social media platform X.

In his post, Carney stated, “President Donald Trump has imposed a 25% export tariff on our automobile sector. In response, the Canadian government is introducing a similar tariff on all U.S. vehicles. The revenue from this tariff will be used entirely for the welfare of Canada’s automobile industry and its workers.”

The decision comes despite the existing Canada–United States–Mexico Agreement (CUSMA), which allows for tariff-free trade between the three countries under certain quotas. According to Carney, while Mexico will continue to receive tariff exemptions under the quota system, the United States will no longer enjoy the same benefit. From now on, every U.S. vehicle entering Canadian territory—whether within or beyond quota—will be subject to the 25% export tariff.

However, the Canadian government has clarified that this tariff will not apply to vehicle parts and machinery. Carney emphasized that the aim is to strengthen and expand Canada’s automobile industry, and the government does not intend to disrupt the flow of raw materials.

Earlier, on April 2, Trump had imposed tariffs on exports from almost every country engaged in trade with the U.S., including a 25% export tariff on Canadian vehicles. He had already introduced a 10% tariff on Canadian electricity and potash, and 25% on most other Canadian goods—excluding steel and aluminum—on March 4. Later, on March 12, the tariff was expanded to include Canadian steel and aluminum as well.

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