Explained | Canada's plan for retaliatory tariffs on the US

Ottawa: Canada announced retaliatory tariffs on US goods on Tuesday in response to tariffs imposed by the Trump administration, with Prime Minister Justin Trudeau and the heads of some Canadian provinces also threatening additional measures.

US President Donald Trump proceeded with 25 per cent tariffs on Canadian and Mexican goods and 10 per cent duties on Canadian energy products from March 4 after a one-month reprieve expired.

Trudeau said retaliatory tariffs on C$30 billion ($20.80 billion) of US imports would take effect immediately, and more tariffs could follow. The retaliation amount is unchanged from what Trudeau had previously announced, along with a list of products to be targeted, in February before the reprieve.

Below are details of Canada's plan.

Retaliatory tariffs

Canada will impose 25 per cent tariffs on C$30 billion in goods imported from the US effective immediately. The duties will remain in place until the U eliminates its tariffs against Canada. The countermeasures do not apply to goods already in transit.

The C$30 billion is a part of an overall retaliatory measure targeting C$155 billion worth of goods imports from the US, with the remaining C$125 billion coming into force after a 21-day consultation period.

Products

The first tranche of retaliation includes a list of 1,256 products such as orange juice, peanut butter, wine, spirits, beer, coffee, appliances, apparel, footwear, motorcycles, cosmetics, and pulp and paper.

In terms of value of imports associated with some of the major products, cosmetics and body care are worth C$3.5 billion, appliances and other household items are worth C$3.4 billion, pulp and paper products are worth C$3 billion and plastic products are worth C$1.8 billion.

Second tranche

The Canadian government will be consulting with the public and stakeholders for a second tranche of retaliatory tariffs. These will include a wide range of products imported from the US such as passenger vehicles and trucks, electric vehicles, steel and aluminum products, fruits and vegetables, aerospace products, beef, pork and dairy.

Non-tariff measures

Trudeau has also said Canada is considering non-tariff retaliatory measures potentially relating to critical minerals, energy procurement and other partnerships. His energy minister has said an export tariff on critical minerals is one option.

Several Canadian provinces are taking US liquor off store shelves and Ontario Premier Doug Ford said all US-based companies will be banned from taking part in government procurement. Ontario is ripping up a C$100 contract with Elon Musk's Starlink, he said.

Ontario, which accounts for more than a third of Canada's total GDP, will apply a 25 per cent surcharge on electricity exported to New York, Michigan and Minnesota if tariffs persist, Ford said.

Nova Scotia plans to double tolls for some vehicles from the United States.

Support

The Canadian government will also take steps to mitigate the impact of its tariff countermeasures on Canadian workers and businesses, the finance ministry has said.

It will establish a remission process to consider requests for relief from the tariffs imposed as part of Canada's immediate response, as well as any future tariff actions, it said.