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Investing.com-- U.S. President Donald Trump on Thursday evening signed an order raising his effective tariff rate on Canada to 35% from 25%, citing a failure on Ottawa’s part in curbing the flow of fentanyl into the United States.
“In response to Canada’s continued inaction and retaliation, President Trump has found it necessary to increase the tariff on Canada from 25% to 35% to effectively address the existing emergency,” a fact sheet released by the White House said.
The 35% levy will not apply to goods under the U.S.-Mexico-Canada Agreement, the White House said, and will take effect from August 1, which is a flat deadline for all of Trump’s proposed tariffs.
The U.S. president had earlier in the day chided Canada for supporting Palestinian statehood, stating that it will “make it very hard for us to make a Trade Deal with them.”
Talks between Washington and Ottawa were seen stalling in recent weeks, with Canadian Prime Minister Mark Carney earlier stating that talks may not conclude by the August 1 deadline.
Last month, Carney’s government had scrapped a planned digital services tax on U.S. technology firms, after Trump chided the tax. But Carney’s government was also seen threatening retaliatory measures against the U.S. over Trump’s tariffs.