US President revives a dormant 1930 law to hit Canada with new tariffs
For the first time in nearly a century, a US president has reached for a dormant 1930 trade statute to punish a neighbour.
US President Donald Trump invoked Section 338 of the Tariff Act of 1930 on Monday to impose additional 50 percent tariffs on a range of Canadian goods, marking the law's first known use since it was written, Reuters reported.
Trump signed three proclamations, CNBC reported, each aimed at a different set of imports tied to what the administration calls Canadian discrimination against US cars, alcohol and dairy.
The duties cover goods from wine to cement to hockey sticks, according to Reuters, and take effect 30 days after signing, on August 19.
The US Trade Representative's office said the tariffs would hit nearly US$20bn of imports from Canada, Reuters reported, or about 5.2 percent of the US$382bn in goods the US bought from Canada in 2025, according to US Census Bureau data cited by the outlet.
"Canada, unlike other partners and allies, continues to retaliate against the United States," US Trade Representative Jamieson Greer said in a statement quoted by Reuters, arguing the measures protect US industry in national-security-sensitive sectors.
Prime Minister Mark Carney said Ottawa had put forward comprehensive proposals to resolve the disputes and that Trump's earlier tariffs breached the North American trade pact.
"Canada stands ready to engage intensively to address outstanding issues with the US," Carney said in a statement, per the outlet, adding that the dispute had raised costs for families, particularly in the US.
Ontario Premier Doug Ford took a harder line, writing on X that Canada should answer "tariff for tariff, dollar for dollar" if the duties proceed, CNBC reported.
The new tariffs apply whether or not goods qualify under the US-Mexico-Canada Agreement (USMCA), Reuters reported, though Trump exempted energy, potash, fish, critical minerals and products already covered by Section 232 tariffs.
To justify the move, the White House cited a roughly 22 percent drop, or about US$5.6bn, in Canadian imports of US motor vehicles from April 2025 through March 2026, and an 81 percent fall, or about US$582m, in US alcohol imports from March 2025 through February 2026.
A White House fact sheet also pointed to Canada's dairy supply-management system and to most provinces halting US alcohol sales, both of which followed earlier US tariffs, Reuters reported.
Trade specialists questioned the legal grounds.
John Veroneau, a former US trade official who has researched the statute, told Reuters the action was "ironic, to say the least," and said the tariffs may be lawful but violate the spirit of a law meant to secure equal rates for all countries.
Carney also has limited room to change course on alcohol.
Diamond Isinger, a former adviser to former prime minister Justin Trudeau on US-Canada relations, said that absent extraordinary measures, "the premiers of those provinces are the ones who decide whether to restock alcohol," Reuters reported.
Greer has kept Canada out of the USMCA talks now under way with Mexico, the outlet said, and holds bilateral discussions in Mexico City this week.
Only China and Canada have chosen to retaliate against Trump's tariffs rather than negotiate a deal, the White House said.
