Trump imposes 50% tariff on Canadian goods over alcohol ban

President Donald Trump signed a proclamation on July 20, 2026, imposing a 50% additional ad valorem duty on certain Canadian products, citing Canada's ban on U.S. alcoholic beverages as an unreasonable and discriminatory trade practice.

The tariffs, set to take effect at 12:01 a.m. eastern time on August 19, 2026, are authorized under Section 338 of the Tariff Act of 1930, which allows the president to impose duties to offset burdens placed on U.S. commerce by foreign discrimination.

According to the proclamation, Canadian provinces and territories began halting purchases, distribution, and retail of U.S. alcoholic beverages in March 2025. Ontario's Liquor Control Board and Quebec's Société des Alcools du Québec both removed U.S. products from shelves and canceled orders. Only Alberta and Saskatchewan subsequently lifted their bans, in June 2025.

The proclamation states that U.S. exports of alcoholic beverages to Canada fell approximately 81% during the March 2025 through February 2026 period compared to the same period a year earlier, dropping from roughly $718 million to approximately $137 million.

The proclamation notes that imports from other countries, including Chile, Japan, Argentina, Ireland, New Zealand, and Australia, increased by 13% to 26% over the same period, with imports from countries other than the United States rising by more than $170 million. European Union imports into Canada accounted for over $100 million of that increase.

The new duties are in addition to any existing tariffs and do not apply to goods already subject to Section 232 duties or articles covered under the World Trade Organization Agreement on Trade in Civil Aircraft.

The proclamation authorizes the U.S. Customs and Border Protection commissioner to issue rules and regulations to implement the duties and make any necessary modifications to the Harmonized Tariff Schedule of the United States.

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