Canada’s finance minister stated that a baseline tariff may be the “price” it must pay to continue shipping goods to the United States. François-Philippe Champagne’s words came following Donald Trump’s State of the Union address, in which the US president stated that tariffs should eventually replace income taxes as America’s primary revenue source. Champagne’s comments come after US Trade Representative Jamieson Greer stated that Canada must accept “some level of higher tariff” if it wants to do business with the United States.
Following the US Supreme Court’s rejection of his prior expansive tariff program, Trump implemented a global 10% duty last week using a never-used law known as Section 122. Champagne told reporters in Ottawa that the American administration believes there will be a cost for accessing the American market. He was asked if the president’s remarks in his speech hindered Canada’s hopes for tariff relief.”Every country in the world that I know of is paying a price,” he continued. “What I’m saying is that Canada is paying the lowest price.”
Canada enjoys tariff exclusions in accordance with the USMCA, a continental free trade agreement. It also faces higher levies on steel, aluminum, and softwood lumber.If Canada agrees to a higher tax on us in exchange for opening up their market to us in areas such as dairy and other goods, that would be a beneficial talk,” Greer told CBC on Tuesday.
Following the trade tensions, Canadian Prime Minister Mark Carney stated that he aims to quadruple Canada’s non-US exports over the next decade, particularly in industries such as metals and automobiles. The United States is by far Canada’s largest customer, accounting for around 75% of Canadian exports. The Canadians’ new tone on US tariffs follows a 6-3 US Supreme Court judgment on Friday that determined Trump’s comprehensive tariff strategy, adopted in April, was illegal and that the president had overstepped his authority.
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