New U.S. Tariffs Take Effect as Canada Faces 10% Rate, With USMCA Goods Exempt
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New U.S. tariffs targeting imports from 60 economies took effect on Friday, July 24, 2026, placing Canada among a group of countries assigned a 10% duty rate.
However, the measure does not apply to all Canadian exports. Goods that comply with the United States-Mexico-Canada Agreement, known in Canada as CUSMA, remain exempt from the new tariffs, according to the Canadian government. Several existing product exemptions also remain in place.
The duties took effect at 12:01 a.m. Eastern Time, immediately after the expiration of a temporary 10% global import surcharge that had been in place for 150 days. The United States introduced the new tariffs under Section 301 of the Trade Act of 1974.
The Office of the United States Trade Representative said the action followed investigations into whether trading partners had effectively prohibited goods made with forced labour from entering their supply chains.
Canada, the United Kingdom, Mexico, India, Argentina, Jordan, Malaysia and several other economies were assigned a 10% tariff. Most of the remaining countries covered by the investigations face a 12.5% rate.
Washington said the lower 10% rate applies to countries that have introduced full or partial restrictions on forced-labour goods, or have committed to implementing such restrictions through trade agreements.
The U.S. action covers a broad share of American imports, but it includes numerous exemptions. Oil and gas, fertilizers, certain food products, aircraft and aircraft parts, and critical minerals are among the goods excluded from the new duties.
Products already subject to separate U.S. national-security tariffs—including automobiles, steel, aluminum and copper—are also exempt from the latest Section 301 tariffs, although they may remain subject to other existing duties.
Goods that were already in transit before the measure took effect have been granted a temporary exemption, provided they enter the United States before 12:01 a.m. Eastern Time on July 28, 2026.
Dominic LeBlanc, Canada’s minister responsible for Canada-U.S. trade, said the decision was not unexpected because Washington had previously indicated that it intended to replace its expiring temporary global tariffs.
LeBlanc stressed that Canada shares the objective of preventing goods made with forced labour from entering supply chains. He said Ottawa would continue engaging constructively with the United States over the measure and other unresolved trade issues.
The Canadian government also highlighted the exemption for USMCA-compliant goods, meaning many products meetings the agreement’s rules of origin will not be subject to the new 10% duty.
The tariffs introduced on July 24 are separate from another U.S. measure targeting certain Canadian products with additional duties of 50%.
Those separate tariffs are scheduled to take effect on August 19, 2026, unless the measure is reduced, modified or withdrawn before then.
The latest decision nevertheless adds further uncertainty for Canadian exporters, particularly businesses whose goods do not qualify for USMCA treatment or fall within the listed product exemptions.
