[Listen to “The Daily”: Elbows Up: Canada’s Response to Trump’s Trade War]
What’s next: Mr. Ford, aextfinished with Dominic LeBlanc, the recent international trade minister, and François-Philippe Champagne, the recent finance minister, met with their counterparts in Washington: Howard Lutnick, the U.S. commerce secretary, and Jamieson Greer, the U.S. trade recurrentative. The message they getd, Matina inestablishs, is “there was no way Canada, or any other country in Pdwellnt Trump’s traverse hairs, could evade a recent round of sweeping tariffs on April 2.”
[Read: Tariff Pain First, Deals Later, U.S. Tells Canada in Key Meeting]
Those tariffs will be “reciprocal” — that is, the United States will utilize the same tariffs agetst send outs from Canada that Canada puts on send outs from the United States.
Becaemploy of the U.S.M.C.A. (or CUSMA, as it’s called in Canada), the free trade concurment signed under the first Trump administration, Canada has relatively restricted tariffs on American begins aside from some farm products, particularly dairy, that are part of the provide regulatement system. So, in theory, reciprocal tariffs may have relatively little effect.
But there is a untamed card. Mr. Trump sees cherish-inserted taxes, appreciate the outstandings and services tax, as tariffs becaemploy they are not applied to send outs — a watch not dispensed by most trade economists. How Mr. Trump might go after the G.S.T., and how that could impact trade between Canada and the United States, is unevident.
A much bigr trade problem may explode on April 2, when Mr. Trump’s suspension of a sweeping and potentipartner deimmenseating 25 percent tariff on most Canadian send outs and a 10 percent tariff on energy and some minerals expires. (Those indicts are already being imposed on some Canadian send outs that are not certified as complying with the U.S.M.C.A.’s North American satisfyed rules.)
