Donald Trump
Donald Trump enacts 50% tariffs on Canada as trade talks collapse The White House, Public domain, via Wikimedia Commons

Donald Trump has escalated his trade war with Canada, accusing Ottawa of exploiting the United States as he announced 50% tariffs on key Canadian imports.

Trump delivered the threat in a Truth Social post, saying Canada had been 'ripping off' the US for years through what he described as high tariffs on American farmers and farm products. He claimed those policies had made life 'impossible' for US farmers and created a $60 billion deficit between the two countries.

'Not sustainable, and NOT ANYMORE!' Trump wrote. The president said that from 1 January 2027, tariffs on Canadian cars, trucks, automotive parts and steel would be increased to 50%.

'Build in the U.S. and there are ZERO TARIFFS,' he added.

Trump then turned his attack directly on Canada's status as a US trading partner.

'Canada will be treated like a State no longer!' he wrote, before calling Canada 'among the worst Nations in the World to deal with' on trade and other matters.

'We Don't Need Canada'

Trump's message framed the dispute as a matter of economic dependence, claiming Canada relies far more heavily on the US than the other way around. 'They feel entitled, and yet, WE DON'T NEED CANADA, THEY NEED US!' he wrote.

He also claimed Canada does 95% of its business with the US, while the US does not depend on Canada to the same extent. The statement marks another sharp turn in Trump's aggressive tariff strategy, which has repeatedly used import taxes as leverage against allies as well as rivals.

Talks Collapse in Washington

The tariff threat came after US-Canada trade negotiations broke down last week. US Trade Representative Jamieson Greer told CNBC's Squawk Box that negotiators had been close to announcing a deal before Canada changed its position.

'We progressed to a point Tuesday night where we had enough agreement among the parties,' Greer said.

But he claimed the talks fell apart when Canadian officials pushed for additional concessions. 'They wanted more,' he said.

Canadian Prime Minister Mark Carney has offered the opposite account, accusing the US of making 'last-minute changes' that were 'unfair' and 'uneconomic'.

New Duties Already Taking Effect

Separate new 50% tariffs on around $20 billion worth of Canadian goods took effect at 12:01 a.m. ET on Saturday. Those duties cover products including wine, hockey sticks and cement.

Although the affected goods represent only a portion of total US-Canada trade, business groups on both sides have warned that the fallout could be severe for exposed industries. Dan Kelly, president of the Canadian Federation of Independent Business, said the impact on small businesses would be 'immediate and significant'.

Trump's newest round of tariffs may further strain the USMCA, the North American trade pact he negotiated and signed in his first term after replacing the 1992 NAFTA agreement. The deal was supposed to redefine trade relations in the region, but the escalating tariff dispute now risks undermining one of Trump's own major economic achievements.

Carney has said Canada will respond with 'dollar for dollar' tariffs on US goods. Greer argued that Washington had tried to accommodate Ottawa by reducing proposed duties on steel, aluminium, autos and softwood lumber. But he said Canadian negotiators still demanded more.

The Canadian dollar fell against the US dollar on Monday morning as investors reacted to the deepening dispute.

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