President Donald Trump is escalating his trade battle with Canada, threatening to impose a steep 35% tariff on Canadian goods starting August 1 unless Prime Minister Mark Carney takes immediate action to curb the flow of fentanyl across the northern border.
In a letter sent Thursday, Trump warned Carney that the tariff could go even higher unless Canada works with the U.S. to stop what he called a “deadly and unacceptable” flow of fentanyl into American communities. The proposed 35% rate is a sharp increase from the current 25% penalty and would apply to a wide range of Canadian exports not covered under the U.S.-Mexico-Canada Agreement (USMCA).
“If Canada works with me to stop the flow of fentanyl, we will, perhaps, consider an adjustment to this letter,” Trump wrote. “These Tariffs may be modified, upward or downward, depending on our relationship with your country.”
The administration clarified that USMCA-compliant goods would remain exempt — for now — but warned that products “transshipped” through other countries to avoid the Canadian tariff would be caught in the net.
Trump’s warning is the latest move in his broader tariff push aimed at nations he accuses of undermining U.S. security or trade interests. The president also renewed his criticism of Canada’s trade barriers, particularly on dairy, where he blasted tariffs of up to 400% and accused Canada of blocking access to its markets.
“Canada charges extraordinary Tariffs to our Dairy Farmers … The Trade Deficit is a major threat to our Economy, and, indeed, our National Security!” Trump wrote.
The president also referenced Canada’s past tariff retaliation and urged Ottawa to work with Washington this time rather than “lashing out.”
The warning to Canada comes amid a wave of tariff threats aimed at countries around the world. Earlier this week, Trump threatened Brazil with a 50% tariff hike over what he described as the political persecution of former President Jair Bolsonaro. In a Truth Social post, Trump called the prosecution of Bolsonaro “nothing more, or less, than an attack on a Political Opponent — Something I know much about!”
He added, “The Great People of Brazil will not stand for what they are doing to their former President.”
Trump hinted Thursday that more letters announcing tariff increases would be going out to other countries soon, including members of the European Union.
“We’re just going to say all of the remaining countries are going to pay, whether it’s 20% or 15%. We’ll work that out now,” Trump said.
The latest threats are part of Trump’s broader push to rebalance global trade and pressure foreign governments on issues ranging from border security to political freedom.