Industry News

Trump Implements Tariffs on Canada, Mexico and China

Feb. 2, 2025
By: Marvin E. McPherson


Citing the Powers of International Emergency Economic Powers Act (IEEPA), President Donald Trump signed an Executive Order and released a fact sheet, imposing significant tariffs on imports from Canada, Mexico, and China. As discussed previously, this is the first time IEEPA has been used to invoke tariffs. The tariffs, effective February 4, 2025, are as follows:

●      Canada: 25% on non-energy imports, and 10% on energy imports

●      Mexico: 25% on all imports

●      China:10% on all imports

These tariffs are in addition to existing duties and will apply to goods that currently qualify for duty-free status under the United States-Mexico-Canada Agreement (USMCA). The executive orders include a retaliation clause, authorizing additional tariffs if these countries implement countermeasures. Notably, no exclusions will be granted, and imports from Canada subject to these tariffs will not be eligible for duty-free entry under de minimis exemptions for low-value shipments (under $800). Additionally, the tariffs cannot be refunded through duty drawback.

The orders provide narrow exemptions for items that were loaded onto a vessel at the port of loading or in transit on the final mode of transport to the United States before February 1, 2025.

President Trump justified these measures by citing Canada and Mexico’s alleged failure to control unauthorized migration into the U.S. and the inability of these countries, along with China, to prevent the importation of fentanyl. The tariffs are to remain in effect until the administration finds that drugs and unauthorized migrants are no longer an issue.

In response, Canadian Prime Minister Justin Trudeau and Mexican President Claudia Sheinbaum Pardo have expressed strong opposition and announced plans for retaliatory tariffs on U.S. goods.

If you have questions regarding the impact of these measures on your supply chain, please contact any attorney at Barnes Richardson and Colburn.