Trump delays 50% tariffs on Canadian goods as trade talks progress

President Donald Trump said on social media that the 50% tariffs on a broad range of Canadian products, slated to begin the next morning, would be postponed for three days while the United States and Canada finalize a trade deal. The delay comes just hours before the levy, which would have affected nearly $20 billion (C$28 billion) of imports, was set to take effect.

Trump’s post noted that the pause is based on “the fact that Canada and the U.S.A., subject to the finalization of documents, have a deal.” Canadian Prime Minister Justin Carney responded in a letter posted on X, saying “substantial progress has been made, although there is important work still to be done.”

Negotiators from both sides have been meeting intensively since July after Trump threatened the tariffs with a deadline of Aug. 19. Issues under discussion include reductions on U.S. auto tariffs, removal of Canadian bans on American liquor sales, and possible revival of the Keystone XL oil pipeline, which Trump has said could be included in a final agreement.

The proposed tariffs would have covered items such as wine, dairy, cement, clothing and hockey equipment, adding to existing duties on steel, aluminium, autos and lumber. Canada has sought a deal that would lower or eliminate these new tariffs, while the United States has asked for concessions such as the removal of Canadian retaliatory tariffs on U.S. autos and greater access for U.S. cheese producers.

The three-day extension was welcomed by Canadian officials and businesses, who warned that the tariffs would harm both economies. Further talks are expected to determine the scope of any tariff reductions, including whether U.S. auto duties could be cut from 25% to 15% and which vehicles would qualify.