Canada Removes Tariffs on USMCA-Covered Goods

USMCA

Canada removes tariffs on USMCA-covered goods effective 1 September, prime minister Mark Carney said. Canada removes tariffs on USMCA-covered goods to mirror the US stance on IEEPA tariffs. Therefore, Canada removes tariffs on USMCA-covered goods while keeping separate metal and auto duties.

What changes now — and what stays

Canada lifts retaliatory tariffs on goods covered by USMCA. The move aligns with Washington’s exemption for Canadian exports. However, Canada maintains a 25% tariff on US steel, aluminum, and automobiles. The US still levies 50% on Canadian steel and aluminum. Average US tariffs on Canadian goods are 5.6%. That compares with nearly 16% globally, Ottawa notes. Trump welcomed Ottawa’s decision and signaled further talks. Both sides will intensify discussions on strategic sectors.

Metals, autos, and the 2026 review

For metals, headline tariffs remain the real constraint. Therefore, steel and aluminum flows still face elevated costs. Auto supply chains gain clarity from the USMCA alignment. However, ring-fenced duties still cloud pricing and sourcing. A joint USMCA review begins in spring 2026. The process could last 6–18 months, shaping future market access. Meanwhile, Ottawa will launch “nation-building projects” to diversify markets. That aims to reduce exposure to US policy shifts.

The Metalnomist Commentary

Policy alignment lowers headline risk but leaves key frictions in metals. Watch the 2026 review for origin rules, CBAM interfaces, and any metal-specific carve-outs that could reset costs.