How Canadian tariffs on U.S. goods may affect your business in 2026

While Canada has matched the United States (U.S.) and removed tariffs on CUSMA-compliant goods, some key sectors such as steel, aluminium and motor vehicles, still face duties. With the Canada–United States–Mexico Agreement (CUSMA)—known as USMCA in the U.S.—scheduled for renegotiation in July 2026, tariffs continue to squeeze North American economies, contributing to an increasingly volatile trade environment.

Tariffs and counter-tariffs played a dominant role in Canada-U.S. trade in 2025, creating real challenges for exporters. Here’s what you need to know about which Canadian tariffs on U.S. goods are still in place and practical steps you can take to reduce their effects and plan for future changes.

As of Sept. 1, 2025, Canada lifted its 25% tariffs on CUSMA-compliant goods, including:

• Food and beverages
• Apparel and footwear
• Cosmetics and toiletries
• Appliances and electronics
• Recreational vehicles and motorcycles

Those goods now receive either standard most favoured nation (MFN) treatment— the baseline tariff rate that Canada applies to members of the World Trade Organization (WHO)—or, if they comply with CUSMA rules of origin, get preferred rates.

Canada continues to apply tariffs on U.S. imports in the following sectors:

The Government of Canada maintains an official surtax list of U.S. products subject to counter tariffs.

Experiencing tariff disruptions?

Export Development Canada (EDC) can help. We’ve added $5 billion in capacity through our Trade Impact Program (TIP) to help eligible Canadian exporters access credit insurance, financing and guarantees.

How tariffs on U.S. imports affect supply chain and pricing

If your company imports steel, aluminum, or non-CUSMA-compliant motor vehicles from the U.S., you’ll continue to face higher prices. When negotiating contracts, consider strategic pricing to offset these costs and help you stay competitive.

These tariffs also affect Canadian companies that rely on U.S. components for manufacturing, as importing to export is a common practice. Many businesses are tightly integrated into global and North American supply chains, with goods crossing the Canada-U.S. border multiple times. In sectors, like automotive manufacturing, these tariffs increase costs and cause shipment delays.

CUSMA is scheduled for a formal review starting July 1, 2026. This review is part of the agreement and allows all three countries to look at its terms and decide whether to continue, or change any rules.

While the review is routine, any changes to its terms could influence how goods move across borders. Exporters should pay attention to the review process and keep business plans flexible in case tariff policies change.

Ongoing trade uncertainty means it’s important to plan ahead and look for ways to reduce risk.

Review and update contracts: The importer of record (IOR) is responsible for paying tariffs. Consider developing an IOR strategy to manage tariffs. For example, negotiating a contract with U.S. suppliers to act as the importer of record could reduce paperwork. Make sure your contracts specify the IOR and review contract language with a legal advisor. Contracts that name the Canadian exporter as the IOR, or use the Delivery Duty Paid (DDP) Incoterm, are affected by tariff changes because these terms make the exporter responsible for import clearance into the U.S.

EDC support for Canadian companies facing tariffs

If your industry is affected by tariffs, EDC can help you manage costs and stay competitive, so you can grow.

Manage tariff-driven cost pressures

• Protect against non-payment and keep your receivables secure when U.S. buyers delay or default with our credit insurance solutions.
• Access more working capital, or secure additional credit, through your bank with EDC backing—ideal for manufacturers facing tariff-driven cost spikes.

Plan for long-term growth

• Find buyers in sectors aligned with Canada’s strengths such as cleantech and critical minerals with EDC’s Business Connections Program.
• Explore market diversification to stay flexible, identify high-potential regions, like the Indo-Pacific, Europe and Mexico, and reduce risk when trade is volatile.

Knowledge that drives decisions

• Review U.S. market intelligence to better understand tariff impacts.
• Join MyEDC for access to reports and personalized advice to build resilience beyond North America.

Take advantage of other Canadian support programs

• The Trade Commissioner Service (TCS) helps companies find partners in new markets and provides information on trade agreements, tariffs and sanctions.
• Business Development Bank of Canada (BDC) provides financing, capital and business loans to help companies manage cash flow and invest in growth.

If your goods meet CUSMA requirements, you may be able to pay lower or no tariffs. Products that qualify under CUSMA’s rules of origin are usually exempt, or subject to lower rates. If your goods don’t meet these rules, they’ll still be subject to Canada’s trade barriers on U.S. imports.

Here are some simple steps to check if tariffs apply to your products:

1. The Canada Tariff Finder: The Canada Tariff Finder is a tool that provides information on products where Canada has a trade agreement. This is a good first step to check if your products may be affected by Canada’s new tariffs.

2. Check CUSMA rules of origin: Rules of origin determine if goods qualify for tariff-free trade. They can be complex, as many products may originate from other countries, but are modified or repackaged in the U.S. For example, steel sheets made in the U.S., but processed in another country, may still be subject to Canada’s new tariffs if they don’t meet CUSMA rules of origin.

The Government of Canada also has online tools to search for tariffs by product and country.

3. Find your product’s Harmonized System (HS) classification: The HS classification system is a six-digit number used worldwide to identify products for customs. You can find HS codes on documentation provided by your supplier, or through online HS tools. Once you have the HS code, you can use it alongside the Canada Tariff Finder to confirm whether tariffs apply to your products.

4. Consult a trade expert: The rules can be complicated. Working with a trade expert can save you time and reduce errors. You can reach out to a customs broker through the Canadian Society of Customs Brokers (CSCB), or freight forwarder, for support. EDC’s Export Help Hub also provides answers to frequently asked trade questions.

How can businesses influence Canada’s tariff decisions?

Canada’s consultation process on tariff responses has closed, but business leaders can still make their voices heard by:

• Joining industry associations, or trade organizations, to amplify your concerns
• Connecting with U.S. suppliers to encourage collaborative lobbying for tariff reductions
• Monitoring Finance Canada updates for future policy consultation opportunities, including the CUSMA review in 2026

Building resilience beyond tariffs

Canadian tariffs on U.S. goods may continue to affect costs and supply chains into 2026. By planning ahead, you can reduce risk and stay competitive.

EDC is here to support you with tailored financial solutions, market intelligence and risk management tools. Talk to an EDC advisor today to build a strategy to help keep your business resilient in a changing trade environment.

This content was created in part using generative artificial intelligence (Gen AI).