Trump Pauses 50% Canada Tariffs as Ottawa Says Deal Remains Unfinished

By Staff, Agencies

US President Donald Trump has delayed a planned 50% tariff on Canadian imports after claiming Washington and Ottawa had reached a trade deal, while Canadian Prime Minister Mark Carney stressed that key issues remain unresolved.

Trump said late Tuesday that the tariffs, set to take effect at midnight, would be postponed for three days as both sides finalize the terms.

“Based on the fact that Canada and the USA, subject to the finalization of documents, have a DEAL,” he wrote on Truth Social.

However, Carney adopted a more cautious tone, saying substantial progress had been made but “important work” remained. The two leaders spoke Tuesday as officials continued negotiations that have stretched for weeks.

Under the emerging arrangement, Washington says Canada would provide broader market access for US goods, economic security commitments and digital trade alignment.

The White House also said Ottawa had agreed to address US concerns over dairy, alcoholic beverages and motor vehicles, though detailed terms remain undisclosed and unconfirmed by Canada.

Meanwhile, automobile tariffs remain a major sticking point. The postponed duties would have affected around $20 billion in Canadian imports, including some goods covered by USMCA protections.

Negotiators have discussed reducing US Section 232 tariffs on Canadian vehicles from 25% to 15%, potentially with further reductions tied to US-made components.

A major dispute centers on how those components should be counted. Washington wants only US-produced parts to qualify, while Canada argues that components made across North America, including Canada and Mexico, should count.

Trump also suggested that the Keystone XL pipeline could be revived, saying it “may be awoken from the grave,” without providing details. The project was canceled by former US President Joe Biden in 2021 following long-running opposition from Indigenous and environmental groups.

Before the tariff pause, Canadian industries warned that 50% duties could trigger layoffs and business closures, particularly in lumber, wine and dairy, while further straining the USMCA framework.

Canada’s trade officials have been negotiating in Washington since last week. US officials have criticized Ottawa over retaliatory tariffs, its dairy policies and restrictions on US alcoholic beverages, while the US spirits industry called for a negotiated return to zero-for-zero tariffs.

For now, the three-day pause gives both governments time to resolve their differences, as Trump portrays the deal as effectively complete while Carney maintains that major elements remain unsettled.