The War on Goods: U.S. and Canadian Tariffs

The recent tariff war between the United Stated (U.S.) and Canada began with President Donald Trump imposing a 25% tariff on all Canadian imports from Canada entering the U.S (with the exception of energy resources, which will have a 10% tariff). In response, the Government of Canada announced a 25% tariff on $30 billion worth of U.S. imported goods entering Canada, and on an additional list of $125 billion worth of U.S. goods. Both lists include products such as clothing, footwear, fruits, vegetables, food and drink, furniture and appliances, lumber, paper, steel and aluminum, among a variety of other goods.

The proposed tariffs between the U.S. and Canada were set to be effective starting February 4th, however both parties put these tariffs on hold for at least 30-days.

I am a business owner, what does this mean for me?

As a Canadian business owner, be wary when ordering stock for inventory. The cost of U.S products will increase, meaning you may have to resort to alternative non-U.S. suppliers.

This double-edged sword impacts both Canadian and U.S. businesses. Canadian product exports to the U.S. products will be in less of demand due to the tariff, meaning less demand for Canadian products and loss of consumers.

How can business owners prepare for the U.S. and Canadian tariffs?

• Evaluate your business’ supply chain and make necessary adjustments to reduce costs (Are my supplies being imported from the U.S.? Are any of my Canadian-originated supplies being exported to the U.S.?).

• Take the time to search for non-U.S. suppliers alternatives to avoid tariffs on U.S. imported products.

• Go over the list of products from the U.S. that are subject to the 25% tariff.