Canada to Announce Retaliatory Tariffs Against US as Trade Dispute Escalates
Canada will announce retaliatory tariffs against the United States on Tuesday, August 25, 2026, according to an official familiar with the plans. The official, speaking on condition of anonymity, said the move escalates a trade fight that has sharply worsened since negotiations with Washington collapsed last week.
Prime Minister Mark Carney signalled on Monday that Canada may shift from matching U.S. tariffs dollar-for-dollar to more targeted retaliation aimed at protecting Canadian workers and businesses. Carney accused Washington of trying to subordinate Canada and said U.S. trade demands confirmed fears that the United States sought to dismantle major Canadian industries, including autos, steel and aluminium.
U.S. President Donald Trump escalated the dispute on Monday, telling Canadian leaders to “fall in line” or face consequences “far WORSE” than existing tariffs. He also threatened new 50% tariffs on Canadian vehicles, auto parts and steel, and launched personal attacks on Canadian leaders, calling Carney “Governor Carney” and criticising Ontario Premier Doug Ford as less capable than his late brother.
Carney rejected the notion that Canada would accept a subordinate role. “An attitude at the negotiation table that Canada is a subsidiary of the United States is not something we're going to accept,” he said. In French, Carney was blunter: “We learned during the negotiations that the Americans want to destroy our major industries, including autos, steel and aluminium. That was one of the main reasons we said no. It was a bad deal.”
Ontario Premier Doug Ford, a Progressive Conservative from a different party than Carney's Liberals, voiced broad political unity in Canada. “We're all in,” Ford said. “Up here, we're at a fever pitch; everyone's in for an economic war. They know they're going to have to sacrifice.” Ford added that “everything is on the table” if the dispute worsens, including cutting off electricity and critical minerals from Ontario to the U.S. — resources increasingly vital to American national security and manufacturing.
The trade conflict has deteriorated since Carney walked away from negotiations on Friday, triggering Trump's threatened 50% tariffs on about $20 billion worth of Canadian goods. Carney cast doubt on U.S. reliability, saying Canada was finding trusted partners “everywhere in the world, except in the United States.” The comments and threats from both sides underscore a sharp reversal in relations between the two neighbours, who have long shared one of the world's most integrated economic partnerships.
