Canada vows sweeping tariffs on US goods as trade negotiations collapse

Canada has vowed to impose sweeping tariffs on U.S. goods in retaliation after trade negotiations collapsed, following a deadline extension from the United States. President Donald Trump's import taxes will target about 5% of what Canada ships to the U.S. annually, including products like hockey sticks, tongue depressors, steel, dairy, appliances, agricultural equipment, pulp and paper, and electronics.

Canada's Prime Minister said the retaliation would take effect the Tuesday after Labor Day, with dollar-for-dollar measures targeting steel, dairy, appliances, agricultural equipment, pulp and paper, and electronics. The Canadian government had been willing to drop remaining retaliatory tariffs on steel, aluminum, and autos if the U.S. significantly lowered its own tariffs.

However, Canada deemed Washington's demands as excessive and insufficient, saying "They asked too much and offered too little." The breakdown in negotiations marks a sharp contrast from earlier optimism, with officials from both countries seemingly on the verge of a compromise. Canadian Premier Doug Ford expressed full support for the retaliation, stating that "everything needs to be on the table."

The political fallout from the tariffs could be as significant as the economic consequences, as Canada and the U.S. have a combined $880 billion worth of yearly goods and services trade.