Trump threatened to escalate tariffs beyond 35% if Canada opts to retaliate with tariffs on U.S. goods. Canadian goods are also subject to sector-specific tariffs, such as 50% levies on steel and aluminum as well as 25% tariffs on non-USMCA compliant autos and auto parts.

Canada is facing a 35% tariff on imports to the U.S. starting Aug. 1, said President Trump, though some of the country’s goods may still be exempt.