Trump's letter to Carney announces 35% Canada tariffs

Daily Mail​

14-07-2025

Donald Trump has thrown a grenade on the tariff negotiations between the United States and Canada with a blistering letter to Prime Minister Mark Carney. The two nations have been trying to settle the tariff war that broke out when Trump returned to office and announced plans to reorganize world trade . Canadian officials had hoped a deal was close, but Trump's latest letter - which he shared to Truth Social on Thursday night - has set negotiations back to square one.
The letter revealed he would raise tariffs on Canadian products to 35 percent from August 1 - a 10 percent increase on the current levy. Trump said the tariff hike was in part due to the fentanyl crisis and Canada's 'failure to stop the drugs from pouring into our country '.
'I must mention that the flow of fentanyl is hardly the only challenge we have with Canada, which has many tariff, and non-tariff, policies and trade barriers ,' Trump wrote in the letter. Trump said 'the fact the United States has agreed to continue working with Canada, despite Canada having financially retaliated against the United States ', demonstrates the 'deep commitment to our trading relationship.' The letter did include a warning shot to Carney, vowing to continue upping the US tariffs if Canada was to impose retaliatory taxes. He said he would consider 'an adjustment to this letter' if 'Canada works with me to stop the flow of Fentanyl.' 'These tariffs may be modified, upward or downward, depending on our relationship with your country,' he added.
The latest round of tariffs are in addition to previously imposed sectoral tariffs on steel, copper and aluminum, which came into effect for most countries on June 4 at a whopping 50 percent. Trump's punishing hike sparked fears American households would see an increase in costs for everyday items, given foreign-made steel and aluminum is used in household products like soup cans and paper clips, as well as big-ticket items like a stainless-steel refrigerators and cars. The two metals had previously faced 25 percent tariffs worldwide since mid-March, when Trump's order to remove steel exemptions and raise aluminum's levy went into effect.
Recent gains in the S&P 500 stock index suggest many investors think Trump will ultimately back down on the increases, which he has done in the past. The letter is similar to others he has fired off to leaders across the globe in the past week as he threatens a global blanket tariff increase similar to those he proposed on 'Liberation Day' on April 2.
Trump had imposed a baseline 10 percent tariff on most imported goods from around the world after a sharp market sell off sparked global panic and fears of a recession . He told NBC News this week he is prepared to double that in the coming weeks, revealing: 'We're just going to say all of the remaining countries are going to pay, whether it´s 20 percent or 15 percent.' But his decision to single out America's second largest trading partner after Mexico came as a surprise.
Carney hit back with a statement on X on Thursday night, writing: 'Throughout the current trade negotiations with the United States, the Canadian government has steadfastly defended our workers and businesses. 'We will continue to do so as we work towards the revised deadline of August 1.' While multiple countries have received tariff letters this week, Canada has become a thorn in Trump's side during his second term. It has imposed retaliatory tariffs on US goods and pushed back on the president's taunts of making Canada the 51st state.
Carney was elected prime minister in April on the argument that Canadians should keep their 'elbows up.' He responded by distancing Canada from its intertwined relationship with the US, seeking to strengthen its links with the European Union and the United Kingdom. Hours before Trump's letter, Carney posted on X a picture of himself with British Prime Minister Keir Starmer, saying, 'in the face of global trade challenges, the world is turning to reliable economic partners like Canada .'
When Carney went to the White House in May , the public portion of their meeting was cordial. But Trump said there was nothing the Canadian leader could tell him to remove the tariffs. 'Just the way it is,' Trump said at the time. Carney indicated he would be willing to be patient in pursuing talks on trade. 'There are much bigger forces involved,' the Canadian leader said. 'And this will take some time and some discussions.'
Trump has sent a series of tariff letters to 23 countries so far. He put a 50 percent tariff on Brazil for the ongoing trial of its former president, Jair Bolsonaro, for trying to stay in office after his 2022 election loss. Trump was similarly indicted for his efforts to overturn his 2020 election loss. The letters reflect the administration's failure to finalize dozens of trade agreements that he claimed would be easy to negotiate. Shortly after unveiling his April 2 'Liberation Day' tariffs, a financial market selloff caused Trump to announce a 90-day negotiating period during which the 10 percent baseline tariff would be utilized .
So far, Trump has announced trade frameworks with the UK and Vietnam, as well as a separate deal with China in order to enable continued trade talks . Trump jacked up import taxes on Chinese goods to as much as 145 percent, but after talks Trump has said China faces total tariffs of 55 percent. In June, Trump said he was suspending trade talks with Canada over its plans to continue its digital services tax, which would hit US technology companies . A few days later, talks resumed when Carney rescinded the tax. Mexico has also faced 25 percent tariffs because of fentanyl.