President Donald Trump threatened Canada with increased tariffs on Thursday, announcing a 35% levy to take effect on August 1 unless the country addresses the trade deficit and fentanyl.
“The United States imposed Tariffs on Canada to deal with our Nation’s Fentanyl crisis, which is caused, in part, by Canada’s failure to stop the drugs from pouring into our Country. Instead of working with the United States, Canada retaliated with its own Tariffs,” Trump wrote in his letter to Canadian Prime Minister Mark Carney. It added that the “flow of Fentanyl is hardly the only challenge we have with Canda, which has many Tariff, and Non-Tariff, Policies and Trade Barriers, which cause unsustainable Trade Deficits against the United States.
He called the trade deficit a “major threat” to the U.S. economy and national security.
“If Canada works with me to stop the flow of Fentanyl, we will, perhaps, consider an adjustment to this letter. These Tariffs may be modified, upward or downward, depending on our relationship with your Country,” Trump added.
Following the announcement, Carney declared that the Canadian government has “steadfastly defended our workers and businesses” and will “continue to do so as we work towards the revised deadline of August 1.”
“Canada has made vital progress to stop the scourge of fentanyl in North America. We are committed to continuing to work with the United States to save lives and protect communities in both our countries,” he wrote, noting, “We are building Canada strong. The federal government, provinces and territories are making significant progress in building one Canadian economy. We are poised to build a series of major new projects in the national interest. We are strengthening our trading partnerships throughout the world.”
Canada recently dropped a digital tax on the United States.
“Canada’s new government is focused on building the strongest economy in the G7 and standing up for Canadian workers and businesses,” Canadian Finance Minister François-Philippe Champagne said last month. “Rescinding the digital services tax will allow the negotiations of a new economic and security relationship with the United States to make vital progress and reinforce our work to create jobs and build prosperity for all Canadians.”
