On August 22, 2025, Prime Minister Mark Carney announced that Canada will eliminate all retaliatory tariffs on U.S. goods covered under the Canada–U.S.–Mexico Agreement (CUSMA), effective September 1, 2025. This action will remove the 25% retaliatory tariff currently in place covering apparel made in the US and exported to Canada, provided they are USMCA/CUSMA-compliant. The tariffs likely had minimal impact: US government stats show US exports of apparel to Canada are down 5% to the end of June.
Retaliatory tariffs will remain in place for key sectors, including steel, aluminum, and automotive products.
This is the latest twist in a complex trade saga over the last seven months. The US has struck “deals” with many trading partners, with varying levels of tariffs, agreements to invest in or purchase from the United States. Most of these tariffs took effect earlier in August, but others (India) are in a state of flux.
For companies exporting Canadian-made apparel to US, little has changed in terms of tariffs - provided their goods comply with CUSMA. The announced 35% tariff on Canadian goods has little impact on this industry because most apparel made here generally complies with the agreement.
In practical terms, the end of the de minimis program is proving far more significant for Canadian exporters (see story: https://www.caf-fcv.ca/posts/de-minimis-fallout/). The de minimis program allows duty-free, simplified entry for shipments valued up to $800 into the United States. This tariff benefit will end for all countries, effective August 29. In September we plan to host a webinar to explain how companies can use the CUSMA tariff benefits to offset the loss of the de minimis program.
Partially in response to these increasing actions relating to tariffs and trade we have set up a new member-only news on our website. We have added multiple backgrounders on various policies including de minimis, reciprocal tariffs, CUSMA renegotiation and many others.
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