The Trade Commissioner Service (TCS), alongside our partners, is working to help Canadian businesses navigate disruptions caused by the various tariffs imposed by the United States (U.S.).
U.S. tariffs: On February 20, 2026, the U.S. Supreme Court released its ruling invalidating the use of the International Economic Emergency Powers Act (IEEPA) to impose tariffs, including the IEEPA fentanyl tariffs imposed on Canada. The ruling does not impact U.S. sectoral tariffs imposed under Section 232 of the Trade Expansion Act of 1962.
In response to the Supreme Court’s decision, the U.S. removed IEEPA tariffs and replaced them with a global 10% tariff under Section 122 of the Trade Act of 1974, effective February 24, 2026, for a maximum period of 150 days, unless extended by an Act of Congress. Canadian exports of CUSMA Canada-United States-Mexico Agreement (CUSMA) compliant goods (i.e., goods that qualify for preferential duty-free treatment under CUSMA) are exempt from the 10% Section 122 tariff (in the same way CUSMA-compliant goods were exempt from IEEPA tariffs). A wide range of other goods are also exempt from the Section 122 tariffs even if non-CUSMA compliant.
U.S. sectorial tariffs: The U.S. maintains following global sectoral tariffs under Section 232 (S. 232) of the Trade Expansion Act of 1962 on imports, including from Canada:
- 50% tariffs on steel and aluminum (including derivative products): There is no CUSMA compliant exemption from Section 232 tariffs on steel and aluminum. The 50% tariff applies only to the value of steel and aluminum content in derivative products. The 10% Section 122 tariff applies to the non-steel, non-aluminum content of most non-CUSMA compliant derivative products.
- 25% tariffs on autos and trucks (and their parts): The values of U.S. content in CUSMA compliant autos and trucks is exempt from the 25% tariffs (subject to the approval of the Secretary of Commerce on a model-by-model basis). CUSMA compliant auto and truck parts are not subject to 25% tariffs until the Department of Commerce establishes a process to apply the tariffs exclusively to the non-U.S. content of auto and truck parts.
- 10% tariffs on buses: There is no CUSMA compliant or U.S. content exemption from the 10% tariff on imports of buses.
- 50% tariffs on semi-finished copper products and copper-intensive derivate products: There is no CUSMA compliant exemption from Section 232 tariffs on copper. The 50% tariff applies only to the value of copper content in covered copper and derivative products. The 10% Section 122 tariff applies to the non-copper content of most non-CUSMA compliant covered copper and derivative products.
- 10% tariffs on softwood timber and lumber: There is no CUSMA compliant exemption from Section 232 tariffs on softwood timber and lumber.
- 25% tariffs on certain upholstered furniture and kitchen cabinets and vanities: There is no CUSMA compliant exemption from Section 232 tariffs on certain upholstered furniture and kitchen cabinets and vanities. On January 1, 2027, the tariff on certain upholstered furniture is scheduled to increase to 30%, and the tariff on kitchen cabinets and vanities is scheduled to increase to 50%.
- 25% tariffs on certain semiconductors: The 25% tariff applies to a small subset of imports of certain semiconductors and derivative products. Goods used in domestic production and for other specified domestic purposes, including in U.S. data centres, research and development, and certain non-data-centre consumer and civil industrial applications, are exempt.
- Potential future 232 tariffs: Additional U.S. Section 232 tariffs could be authorized based on the findings of Section 232 investigations on pharmaceuticals; critical minerals; personal protective equipment, medical consumables, equipment, and devices; commercial aircraft; robotics and industrial machinery; polysilicon and derivatives; unmanned aircraft systems; and wind turbines.
