The Trump Administration Imposes Tariffs on Canada, Mexico, and China

Citing emergency powers under the International Emergency Economic Powers Act (IEEPA) and the National Emergencies Act (NEA), the Trump Administration issued three Executive Orders imposing tariffs on goods imported from Canada, Mexico, and China on February 1, 2025.¹ The Executive Orders were originally set to go into effect on February 4, 2025; however, it was announced late Monday afternoon (February 3rd) that the proposed tariffs on Mexican and Canadian goods would be delayed for 30 days. The tariffs for goods imported from China will still go into effect on February 4, 2025.

Each of the three Executive Orders issued on February 1st specifically calls for an “ad valorem” tariff, which is a tax calculated as a percentage of the value of the imported good. Tariffs can also be “specific," which is a flat charge for a unit or quantity of goods or a combination of both.

The Executive Orders impose:

• A 10% tariff on all goods imported from China
• A 25% tariff on all goods imported from Mexico.
• A 25% tariff on all goods imported from Canada, except for “energy resources,” will be subject to a 10% tariff. “Energy resources” are defined in a separate January 20, 2025, Executive Order (Executive Order 14156 “Declaring a National Energy Emergency”) as “crude oil, natural gas, lease condensates, natural gas liquids, refined petroleum products, uranium, coal, biofuels, geothermal heat, the kinetic movement of flowing water, and critical minerals, as defined by 30 U.S.C. 1606 (a)(3).”

The Executive Orders specify that the tariffs are in addition to any other applicable duties, fees, or charges and that the general statutory “de minimis exemption” for imported goods valued at under $800 will not apply.

Unlike the tariffs imposed by the Trump Administration in 2018, which were limited, to steel, aluminum, solar panels, and washing machines, the February 1st Executive Orders apply to all imported goods and rely on an updated harmonized tariff schedule to be issued at a later date for specific good classifications. They also reserve the ability of the President to “increase or expand” the scope of the tariffs should Mexico, Canada, or China retaliate by imposing tariffs on U.S. exports. China announced its intention to file a complaint with the World Trade Organization, as well as its intent to take other “unspecified corresponding countermeasures,” and President Sheinbaum issued a statement announcing Mexico’s intent to take retaliatory tariff and non-tariff means, but similarly, did not provide specific details. 

In contrast, Prime Minister Trudeau announced that Canada would impose 25% tariffs on USD $155 billion of U.S. goods, with a portion effective on February 4, 2025, and the rest phased in after a 21-day public comment period. The country's Department of Finance website provided specifics of the Canadian plan, including a list of affected goods, but these tariffs have also been suspended for the next 30 days. Even with a pause on tariffs, however, provinces in Canada are already implementing retaliatory measures by removing American products from their shelves and reevaluating existing contracts with U.S. companies while encouraging private companies in their boundaries to do the same. 

The 30-day pause ends March 4, 2025, and further changes in proposed tariff and trade policy are expected.

^{1 Executive Order “Imposing Duties to Address the Situation at Our Southern Border” (February 1, 2025), Executive Order Imposing Duties to Address the Synthetic Opioid Supply Chain in the People’s Republic of China (February 1, 2025), Executive Order Imposing Duties to Address the Flow of Illicit Drugs Across Our Northern Border (February 1, 2025)}