Canada’s new counter-tariffs are set to hit hundreds of American products. Here’s what crosses the border, what’s being taxed, and which states could feel it most.

On September 8, tariffs of up to 50% will take effect on more than 700 American products entering Canada. It’s the latest exchange in a trade dispute between two countries that moved roughly $879 billion in goods and services between them last year — the largest two-way trading relationship the United States has with any country. Here’s what actually crosses the border, what’s being taxed, and which states are most exposed.

The Relationship

  • Canada and the United States exchanged roughly $872 billion in goods and services in 2025, making Canada the largest U.S. trading partner by total volume when imports and exports are counted together.
  • The U.S. imported $453.6 billion in goods and services from Canada and exported $426.3 billion, leaving a $27.3 billion gap.

What Canada sends us — of the $453.6 billion in goods and services the U.S. imported from Canada in 2025, 85.8 percent was goods and 14.2 percent services. The three largest categories totaled $301.1 billion, about 66 percent of that $453.6 billion — USAFacts

  • Industrial supplies and materials (oil, chemicals, plastics): $195.9 billion — 43.2 percent
  • Automotive vehicles and parts: $52.8 billion — 11.6 percent
  • Capital goods: $52.4 billion — 11.6 percent
  • Largest service category: telecommunications and information services, $16.5 billion

What we send them — of the $426.3 billion the U.S. exported to Canada in 2025, 78.4 percent was goods and 21.6 percent services. The three largest categories totaled $245.9 billion, about 58 percent of that $426.3 billion — USAFacts

  • Industrial supplies and materials: $96.9 billion — 22.7 percent
  • Capital goods and automotive vehicles and parts follow, in that order
  • Largest service category: business services (R&D, consulting, tech), $26.6 billion

The Energy Piece

  • The Energy Information Administration valued U.S. energy imports from Canada at about $111 billion in 2025, down from $124 billion in 2024 as lower crude prices reduced the trade’s value, and that single category is larger than most countries’ entire exports to the U.S.
  • Canada accounts for 51% of total U.S. energy imports.

What is Being Taxed

In force now:

  • 50% on a range of Canadian goods under Section 338 of the Tariff Act of 1930, which allows up to 50% on a country found to discriminate against US commerce. Effective August 22 — and a United States-Mexico-Canada Agreement (USMCA) certificate does not grant an exemption. Carve-outs are narrow: energy, potash, fish, critical minerals, some civil aircraft, and anything already hit by Section 232.
  • 50% on steel, aluminum, and copper under Section 232 of the Trade Expansion Act of 1962, which lets the President restrict imports found to threaten national security.
  • Canada’s answer, in force September 8: $20 billion in US goods hit with tariffs of 15, 25, or 50%, matched dollar for dollar to the US rates — 50% on milk, steel, aluminum, perfume, golf clubs, and video game consoles; 25% on cheese, carpets, and appliances; 15% on forklifts and industrial molds. Seafood was dropped from the list after lobster-industry pushback.

Which States Are Most Exposed

  • Canada is the top export customer for 27 states and the top import partner for 23, more than any other country.
  • North Dakota is most dependent, with Canada taking 80.6% of its exports, followed by Montana at 46.6% and South Dakota at 45.9%; Maine is at 41%, Michigan 39%, and Wisconsin 31%.
  • Manufacturing states like Michigan and Indiana will likely feel it more than agricultural states like North Dakota, since Canada’s tariffs hit U.S.-made appliances, steel, aluminum, and tools while soybeans and wheat are largely exempt.
  • Over 1 million American jobs depend on exports to Canada.

What to Watch

  • Canada’s tiered tariffs took effect September 8.
  • Section 338 carries no fixed expiration, so it remains in force indefinitely unless President Trump modifies or terminates it.
  • Absent a deal, U.S. tariffs of 50% would extend to all Canadian automotive and steel imports on January 1, 2027 — broader than the Section 232 action already in force.
  • Canadian Prime Minister Mark Carney suspended negotiations and recalled Canada’s negotiating team on August 22 after a brief tariff pause expired and talks broke down.

The tariffs on both sides are in force or imminent, and the negotiating channel that might unwind them is closed. What happens after September 8 depends less on the rates themselves than on whether the two governments return to the table, and neither has said when that might be.