Why It Matters

A Congressional Research Service (CRS) report published September 14 examines recent tariffs on Canadian products, and their legal precedent. On July 20, President Trump announced plans to impose 50% tariffs on certain Canadian goods beginning August 19. The announced tariffs targeted alcoholic beverages, dairy products, and motor vehicles. Trump expressly invoked Section 338 of the Tariff Act of 1930, a statute the report identifies as having been expressly cited for the first time by a president in imposing tariffs. Congress has constitutional authority over foreign commerce and tariffs.

The sequence also left businesses and policymakers tracking a suspension through Aug. 22, followed by tariffs taking effect after negotiations failed to produce an agreement.

The Big Picture

Section 338 directs the president to impose tariffs on goods from foreign countries that discriminate against U.S. commerce in specified ways, and it permits additional duties of up to 50%. The statute also authorizes the president to exclude a country’s products from U.S. imports if the discrimination continues or increases after tariffs are imposed. The U.S. International Trade Commission is assigned to ascertain discrimination, notify the president, and provide recommendations, and it requested public comments Sept. 4 on carrying out those responsibilities.

The covered categories of goods include paper and wood products, sports equipment, honey, plants, household and beauty products, bags, hides and skins, and dog leashes, while a September 8 update added certain dairy and wood products, furniture, and motorboats. In 2025, the United States imported approximately $967 million of products appearing on the import-exclusion lists, representing about 0.3% of total U.S. imports from Canada by value.

The new authority operates alongside earlier measures: the United States began imposing tariffs on most Canadian imports under the International Emergency Economic Powers Act in March 2025, but the Supreme Court ruled in February that the law does not authorize presidential tariffs.

The Bottom Line

Some Canadian sectors, including steel, aluminum, automobiles, and lumber, remain subject to Section 232 tariffs, including goods that comply with United States-Mexico-Canada Agreement (USMCA) requirements. Most Canadian goods otherwise qualify for duty-free U.S. entry under USMCA product-specific rules of origin, but the Section 338 tariffs do not exempt goods that meet those rules.

The administration announced September 8 that some product lists would change September 15, while import bans on certain Canadian goods were set to take effect September 29. Canada’s response included tariffs on C$27.6 billion worth of U.S. goods beginning September 8, a figure the report estimates as the equivalent of US$20 billion.

Congressional proposals now span investigations of Canadian trade practices, repeal of tariff authorities, and requirements for congressional approval of tariffs involving U.S. allies.

Access the Legis1 platform for comprehensive political news, data, and insights.

Spot something wrong? Report an issue with this article