By Andrew Miller
On July 20, Trump placed a 50% tariff on imported Canadian cars, wine, cheese, cement, and dozens of other categories, taking effect in 30 days.
Goods from Mexico and Canada normally cross into the U.S. tariff-free under the USMCA. Not this time.
That’s because the tariffs aren’t coming from the USMCA at all. They’re built on a provision of the Tariff Act of 1930 that lets a president tax any country found to discriminate against U.S. commerce. It hadn’t been invoked since 1949, back when it was floated as leverage against China and never actually used.
The administration’s discrimination case is specific: Canada has taxed non-USMCA-compliant U.S. vehicles at 25% since April 2025, nearly every province stopped selling American alcohol last year, and its cheese quotas favor the EU over the U.S.
Canada isn’t responding with one voice. Prime Minister Mark Carney has offered to “engage intensively” rather than retaliate, while Ontario’s premier, Doug Ford, wants Canada to “respond tariff for tariff, dollar for dollar.”
Business groups on both sides of the border want something simpler than either position: time. The Canadian Chamber of Commerce and the U.S. Distilled Spirits Council are both pushing to use the 30-day window to strike a deal before it takes effect, warning that American bars and restaurants absorb the cost either way.
There’s a reason President Trump reached for a 1930 statute instead of something newer.
The Supreme Court killed his last set of tariffs in February for relying on emergency powers Congress never gave him. This one doesn’t need an emergency. It just needs a discrimination finding the administration writes itself.
It’s worth keeping an eye on even if your business doesn’t rely on Canadian goods. Whatever happens over the next 30 days could be the template for future tariffs imposed on other countries.
P.S. Thirty days isn’t much time to reprice a supply chain. Signet can help you find funding that fits while you sort out the new math. Let’s talk.