US President Donald Trump has said that he will double tariffs from 25% to 50% planned on Canadian steel and aluminum imports.
He has already imposed separate 25% tariffs on other imports from Mexico and Canada, but announced exemption for car manufacturers almost immediately and then expanded it to cover other goods.
They have also placed 20% levy on Chinese goods.
Canada and China retaliate with their own tariffs against American goods, fearing the global trade war.
What are tariffs and how do they work?
Tariffs are taxed on imported goods from other countries.
Companies bringing foreign goods in the country pay tax to the government.
Typically, the tariff is the percentage of the value of a product. 20% tariff on Chinese goods means that the product of $ 10 (£ 7.76) is an additional $ 2 charge.
Firms can opt for customers to pass the cost of tariffs or at all.
The US has usually charged low tariffs on goods than other countries.
Trump’s new tariffs – and their promise to further the “mutual” Levies on goods in other countries – can lead to a sharp increase in prices paying for goods worldwide.
Why are Trump using tariffs?
Tariff is a central part of Trump’s economic plans. He says that tariffs will promote American manufacturing and protect jobs, as well as increase tax revenue and increase the economy.
The goods from China, Mexico and Canada calculated more than 40% imports in the US in 2024.
But Trump has accused three countries that they are not enough to eliminate migrants and illegal drugs such as the flow of Phantanel in the US.
All three countries have dismissed the allegations.
Fentanyl is associated with thousands of overdose deaths in the US every year.
Outgoing Canadian Prime Minister Justin Trudeau said that his country was responsible for less than 1% of Phentineil entering America, Most of which come from Mexico,
What is happening with tariffs against Canada and Mexico?
Trump has introduced 25% tariffs on goods from both American neighbors, Canada and Mexico.
These were originally due to starting on 4 February, but delayed for a month to allow further interactions. 25% tariff began on March 4, with 10% tariff on Canadian energy imports.
On March 5, Trump announced Monthly tariff discounts for cars made in North America Which complies with the current free trade agreement of the continent, the US-Maxico-Canada Agreement (USMCA).
The deal, which was interacted by Trump during his first term in the office, determined the rules how many cars should be made in each country to qualify for duty-free treatment in every country.
Canadian and Mexican tariff inspired the possibility of significant impacts on car construction.
A vehicle in the component parts usually cross the US, Mexican and Canadian boundaries several times before it is completely gathered.
After the announcement, shares increased among major American car manufacturers.
Trump on 6 March Tariff exemption expanded to include other items sent under USMCA,
Currently, items covered by Pact rules include television, air conditioner, avocado and beef according to the analysis of firm trade partnership worldwide.
Trump also reduced tariffs on potash – a major component for fertilizer used by American farmers – from 25% to 10%.
A White House official said that about 50% of US imports from Mexico and 62% from Canada could still face tariffs, although they can change figures.
How did Canada respond to the American tariff?
How did Mexico respond to the American tariff?
Mexico delayed retrenching tariffs on American goods during an early month’s stoppage.
President Claudia Shinbam urged Mexican to “stay calm” on Trump, stating that “cooler heads would be strong.”
She also agreed to deploy 10,000 soldiers on the US-Maxico border to help deal with smuggling.
Speaking after the tariff was implemented on March 4, he said that the US judgment promised to respond with “no justification”, and “tariff and non-tariff measures”.
However, before installing them, Trump announced concessions for car makers and other items, which he welcomed.
While Trump has been a very critic of his Canadian counterpart Trudeau, he has praised Shinbaum, writing on his social media site, Truth social, that “our relationship has been very good and we are working hard on the border.”
How will steel and aluminum tariffs work?
The US imports more steel than any other country – and Canada, Brazil and Mexico are its top three suppliers.
Canada is also the largest supplier of aluminum to the US, which provides about 60% of the imported amount.
When Trump first announced that A 25% tariff on steel and aluminum imports will start from March 12He said that there would be no exception.
When he announced that This levy will double for metals coming from Canada on March 11He said that it was to charge American energy customers more due to the decision of that country.
While writing on Truth social, he said: “Ontario, based on Canada, keeping 25% tariff on ‘electricity’ coming to the United States, I have instructed my Commerce Secretary to add an additional 25% tariff.”
American companies using steel and aluminum to make products warns tariffs that tariffs can increase their prices.
Trump first announced tariffs of 25% on steel and 10% on aluminum in 2018, during his first term as President.
However, he later interacted on exceptions to many countries including Australia, Canada and Mexico.
Despite those previous exemption, Tariff raised the average price of steel and aluminum in the US by 2.4% and 1.6% respectively, according to the US International Trade Commission.
What is happening with tariff against China?
10% duty on all goods imported from China Started on 4 February,
Trump later said Shipment less than $ 800 will be exempted,
On 10 February, China Reply with your own tariffIncluding 10–15% tax on some American agricultural commodities.
Beijing has also targeted various American aviation, defense and technical firms by adding to “incredible unit list” and implementing export control.
On March 4, 10% levy doubled.
China urged the US to interact with Beijing as soon as possible.
Foreign Ministry spokesman Lynn Gian warned, “If the United States … a tariff war, a business war, or any other type of war remains, the Chinese side will fight them to the bitter end,” the Foreign Ministry spokesman Lin Gian warned.
Which products will be affected and prices will increase?
All the goods in China are covered by 20% tariff of more than $ 800 value.
Non-free goods imported from Mexican and Canada are under 25% levy.
Canadian energy exports in the US face 10% tariff, which can affect a wide range of businesses.
Steel and aluminum imports from Canada will be taxed at 50%, while people in the rest of the world will be taxed at 25%.
According to official data, the US tariff on imported washing machines between 2018 and 2023 increased the price of laundry equipment by 34%. Prices fell after the tariff ended.
Many economists have warned that the latest round of Trump’s tariff may indicate a comprehensive trade war that can usually put prices more.
Will the UK and Europe have to pay tariffs?
Trump had earlier told the BBC that the UK was “out of line”, But suggested that a solution “work can be done,
The UK exports pharmaceutical products, cars and scientific equipment to the US.
Trade Secretary Jonathan Reynolds said the UK should be kept out of the tariff as it buys more than the US as it sells there.
Speaking in Parliament after the announcement of steel and aluminum tariffs, trade minister Douglas Alexander promised a “quiet and clear-oriented” response,
During its 26 February cabinet meeting, Trump said he would announce sanctions on European Union goods “very soon”,
“It will usually be 25% and it will be on cars and everything else,” he said.
The US had a $ 213BN trade deficit with the European Union in 2024 – Trump has previously described some as “torture”.
In response, the European Commission stated that it would “react against firmly and immediately inappropriate tariffs”.
American companies Harley Davidson and Jack Daniel have faced tariffs of the first European Union.
