Ottawa hits back at U.S. with counter-tariffs on $27.6 billion in goods
The federal government has announced a $7.5-billion support package for Canadian workers and businesses Tuesday morning while confirming it will impose retaliatory tariffs on $27.6 billion worth of American imports beginning Sept. 8, escalating the ongoing trade dispute with the United States.
The measures come in response to a U.S. decision to impose a 50 per cent tariff on $27.6 billion in Canadian goods, which took effect Aug. 22. Canada said its counter-tariffs will match U.S. Section 338 and Section 232 tariff rates dollar for dollar, with individual product rates set at 15, 25, or 50 per cent depending on the good.
Targeted sectors include steel, dairy, appliances, agricultural equipment, pulp and paper, and electronics. The tariffs apply only to goods originating from the United States and will take effect at 12:01 a.m. on Sept. 8, 2026. Goods already in transit to Canada on that date are exempt.
"This is an unprecedented challenge imposed on Canada," said Finance Minister François-Philippe Champagne at a press conference. "Canadians will meet the moment. We will meet the moment together."
Support for employers
The $7.5-billion domestic support package builds on nearly $25 billion in measures the government says it has implemented over the past 18 months. Key components include a $1.5-billion boost to the Regional Tariff Response Initiative, delivered through Canada's seven Regional Development Agencies, with the cap on non-repayable contributions raised from $1 million to $3 million.
The Business Development Bank of Canada will add a second $500 million liquidity stream through its Pivot to Grow program, offering working capital loans of $250,000 to $5 million with interest-only payments over 36 months. Eligibility thresholds have also been lowered, with the minimum annual revenue requirement for applicants reduced to $1 million.
A new Canada Strong Diversification Fund, backed by $2 billion in funding, will support tariff-impacted companies with shovel-ready capital maintenance projects. The government said a fast-track, one-step approval process will be implemented to accelerate project timelines.
For large employers, the government announced expanded flexibilities to the existing $10 billion Large Enterprise Tariff Loan facility, increasing liquidity support coverage from 24 to 36 months and extending the maximum loan term from 10 to 15 years.
Worker investments
For workers, the government announced $3.5 billion in rapid response supports, including extensions to temporary Employment Insurance measures. These include waiving the one-week EI waiting period for an additional year, allowing workers to access EI without first exhausting separation payments, and extending by eight months a measure that provides an extra 20 weeks of regular EI benefits for long-tenured workers.
A new temporary measure will also allow workers who voluntarily left jobs in recent months to access EI, provided their most recent job loss was not their fault.
A new Workforce Retention and Retraining Program will consolidate the existing EI Work-Sharing program and Worker Retention Grant into a single offering, with employers eligible for up to $1,000 per participant to cover training and administrative costs.
Nearly 90,000 Canadian jobs could be lost if the new round of U.S. tariffs remains in place — and some of the hardest-hit provinces may not be the ones facing the steepest duties, according to a new analysis.
