Canada to announce retaliatory tariffs after Trump warns of 'worse consequences'

The Trump administration has not ruled out the possibility of Canada becoming the 51st U.S. state, instead insisting that the Canadian Prime Minister Mark Carney engage in good faith negotiations after recent trade talks fell through. Treasury Secretary Scott Bessent told reporters that President Trump would like Canada to come to the table and negotiate in good faith, noting that the Canadians chose to reject a "quite good deal" offered to them last week.

Bessent accused Carney of rising to power on an anti-American, anti-Trump platform and questioned whether the prime minister was acting in the interests of Canadian voters. The Treasury secretary's remarks came as the U.S. imposed 50% tariffs on approximately $20 billion worth of Canadian goods and threatened to impose another 50% tariff on Canadian cars and auto parts.

Trump has criticized Canada for feeling entitled while not contributing equally to the economic relationship, emphasizing that Canada relies on the U.S. for 95% of its business.

Trump's statehood proposal dates back to his campaign but continued after he returned to the White House. He argued that Canada already enjoys many benefits of being part of the U.S., particularly in trade and national security, without fulfilling the same obligations. The president has also expressed concern over the U.S. trade deficit with Canada, Canadian defense spending, and what he perceives as an imbalance in economic relations.

In February 2025, Trump suggested that Canada become the 51st state, promising lower taxes and greater U.S. military protection while eliminating tariffs and other trade barriers. He reiterated his stance in January 2026, directing 100% tariffs at Canada's economic relationship with China. The trade war between the U.S. and Canada has intensified, with Carney rejecting Trump's statehood suggestion and portraying the tariffs and threats as evidence of Canada's need to reduce its economic dependence on the U.S.

Carney has warned that the proposed tariffs could harm Canada's auto industry, while Canadian officials have threatened retaliatory measures. The escalating tensions have put the two leaders at odds, with U.S. Vice President Kamala Harris making it clear that the administration is frustrated with Carney, even going so far as to mock the prime minister for trying to "out-tough" Trump during trade negotiations.