Global Daily Tax News, Trump Delays New 50pc US Tariffs On Canada, (Aug 20, 2026)

Having threatened the imposition of a 50-percent tariff on Canadian goods from August 19, 2026, US President Donald Trump announced a last-minute u-turn allowing an additional three days for the two countries to resolve a series of trade issues.

On July 20, 2026, Trump signed three Proclamations pursuant to Section 338 of the Tariff Act of 1930 to impose additional 50-percent tariffs on certain goods of Canada, citing "Canada's discriminatory treatment of American products", to "level the playing field" for American cars, alcohol, and dairy.

Trump said the tariffs would apply to a wide range of exports, from wine to hockey sticks to cement. At the time, the White House said the Section 338 tariffs would apply to all covered goods regardless of whether a good originates under the US-Mexico-Canada Agreement (USMCA), with carve-outs for energy, potash, products subject to tariffs under Section 232, and certain other goods, such as fish and critical minerals.

Writing on his Truth Social platform, President Trump stated: "I have paused the 50 percent tariffs against Canada that were scheduled to kick in tomorrow morning, for a three-day period, based on the fact that Canada and the USA, subject to the finalization of documents, have a deal! The great Keystone XL Pipeline, long ago killed by Sleepy Joe Biden, may be awoken from the grave!"

The Keystone XL Pipeline was intended to transport crude oil from Alberta, Canada, to Nebraska but was abandoned in 2021.

On the announcement, Canadian Prime Minister Mark Carney said: "Over the last number of weeks, Canada has engaged in intensive discussions with the United States to address outstanding trade issues and deliver greater certainty and real benefits for Canadian businesses, workers, farmers, and families."

"Substantial progress has been made, although there is important work still to be done. As this work is ongoing, the United States has agreed to postpone the implementation of its 50 percent tariff on a range of Canadian goods under Section 338 of the US Tariff Act of 1930 until end of day, August 21."

"While we continue this work, Canada remains focused on building a stronger, more independent, and more competitive economy at home," Carney said.