Canada Hits Back: 25% Tariff on US Vehicle Imports

Post by: Pratik Kumar

Photo : Reuters

Canada has decided to put a 25% tax on cars coming from the United States. This is because US President Donald Trump announced new taxes on Canadian goods. Prime Minister Mark Carney said that Canada will charge this tax on American cars that do not follow the trade rules between the two countries. The money from this tax will be used to help Canadian car workers and the car industry.

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Carney wrote on X that Canada will take this step to answer Trump's new tax rules. He said all money collected from these taxes will go toward helping Canadian workers and businesses. Even cars that follow the trade deal between Canada, the US, and Mexico (CUSMA) will be taxed 25% on any parts that do not come from Canada or Mexico. This money will also go to support Canadian workers.

Carney explained that Canada’s tax rules will be different from Trump’s. He said that Canada will not tax car parts because they are an important part of how businesses work together. He also said Canada will make a plan to help car makers build more cars in Canada.

Carney called the US tax on Canadian cars unfair. He said that the world economy has changed in one day, and Canada must act to protect its people and businesses. He said Canada will always stand up for its workers and make sure the economy stays strong.

This decision comes after the US already put taxes on Canadian goods. On March 4, the US put a 25% tax on Canadian goods and a 10% tax on energy and potash. On March 12, the US added a 25% tax on Canadian steel and aluminum. On April 3, a 25% tax on Canadian cars started, affecting more than 500,000 workers in Canada. The US also plans to add taxes to some car parts before May 3.

Trump’s trade rules are affecting many countries. He announced a national economic emergency and put at least a 10% tax on goods from more than 180 countries. Some of the highest taxes are 26% on India, 49% on Cambodia, 46% on Vietnam, 34% on China, 24% on Japan, and 20% on the European Union.

After Trump’s speech, the US stock market dropped. Now, people are watching to see what will happen in the Asian markets when they open for business.

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