CUSMA-compliant goods exempt from Trump's latest tariff threat on Canada

Jenna Benchetrit · CBC News

· Posted: Jul 11, 2025 9:41 AM EDT | Last Updated: July 11

U.S. President Donald Trump's latest menace of a 35 per cent tariff connected imports from Canada volition not use to goods that comply with the Canada-U.S.-Mexico Agreement (CUSMA), a Trump medication authoritative told CBC News.

The 35 per cent tariff, which the U.S. president posted astir connected TruthSocial past night, is expected to use to goods presently tariffed astatine 25 per cent, the authoritative said.

U.S. tariffs connected potash and vigor are expected to stay astatine 10 per cent. However, nary last decisions person been made by Trump.

Prime Minister Mark Carney acknowledged the announcement connected Thursday night, saying that the authorities has "steadfastly defended Canadian workers and businesses."

• Cross Country Checkup is asking: What people are you giving Prime Minister Mark Carney so far? Leave your remark present and we whitethorn work it oregon telephone you backmost for our amusement connected Sunday.

Speaking to reporters connected Friday, Trump said he'd shared the connection with Canadian officials the time before.

"They called. I deliberation it was reasonably well-received," helium said.

He besides reiterated a acquainted talking constituent astir U.S. trading partners.

"We've been taken vantage of for many, galore years by countries some person and foe. And frankly, the friends person been worse than the foes successful galore cases," helium said. "So I would say, conscionable support working, it's each going to enactment out."

How does the CUSMA objection work?

For an import to suffice for tariff-free attraction nether CUSMA, it indispensable comply with the agreement's "rules of origin" — a acceptable of standards that find however overmuch of the bully should beryllium produced successful North America.

Even if the bully meets the rules of origin, that doesn't marque it automatically exempt from tariffs. The importer inactive has to nutrient oregon get a papers that certifies the root of the goods.

WATCH | Trump calls CUSMA a 'good deal' during Carney gathering successful May: 

There are wide rules of origin, and rules of root that are circumstantial to definite products. Vegetables harvested successful Canada or minerals mined successful Canada are taxable to a "wholly obtained" regularisation of origin.

Others are considered "originating" if they conscionable product-specific rules.

For example, a finished merchandise mightiness beryllium classified otherwise nether CUSMA than the materials that are utilized to marque the merchandise (e.g., a woody array that is made from oak imported from extracurricular North America.)

New deadline for commercialized deal

The threat of higher tariffs comes aft respective weeks of heightened volatility successful the Canada-U.S. commercialized relationship, with Canadian officials hopeful that they could travel to an statement with their confederate neighbours by July 21.

Carney acceptable that day aft gathering with Trump during the G7 acme successful Kananaskis, Alta.

However, U.S. officials person floated different timelines for a woody without mounting a circumstantial date. Trump's latest menace says that a 35 per cent tariff would spell into effect connected Aug. 1. Carney confirmed the revised deadline connected Thursday evening.

WATCH | Trade woody deadline reset to Aug. 1: 

"My conjecture is that the negotiations were not going precise well, successful the consciousness of the Americans were astir apt looking for Canada to enactment much things connected the array to commercialized with, and were astir apt getting frustrated arsenic the deadline came up," said Mark Warner, an planetary commercialized lawyer who practises successful Ontario and New York.

He suggests the U.S. is trying to crook up the unit connected Canadian officials, and that they indispensable beryllium realistic. 

"We deliberation we've made these hard-won gains. But this is not astir rule now. This is astir figuring out — however bash we get this feline to determination disconnected looking astatine america and look astatine idiosyncratic else? And if we don't, past we carnivore the consequence."

Late past month, the U.S. president announced that helium was calling disconnected negotiations with Canadian officials, citing a integer services taxation that was acceptable to spell into effect the pursuing week.

Within a substance of days, the national authorities said that it would rescind the taxation successful bid to "advance broader commercialized negotiations" with the U.S., and those talks resumed.

Why Trump keeps raising proviso management

In assorted societal media posts, including the station from Thursday evening, the president raised his qualms what what helium says is Canada's "failure" to halt fentanyl from "pouring into our country."

Fentanyl seizures person ticked up at the U.S. northern border, according to information from U.S. Customs and Border Protection, but are inactive overmuch little than those astatine the U.S. confederate borderline shared with Mexico.

He besides took contented with Canada's supply-managed dairy manufacture — a longtime commercialized irritant for the United States. Parliament precocious passed a instrumentality that would instrumentality proviso absorption disconnected the array successful commercialized negotiations.

When CUSMA was negotiated successful 2018 to regenerate NAFTA, Trump called the agreement — referred to arsenic USMCA successful the U.S. — "a large commercialized deal," though helium had raised Canada's proviso absorption strategy arsenic an contented then, too.

The U.S. president has made respective claims astir Canada's proviso managed dairy systems, but they are often inaccurate. High tariff rates connected U.S. dairy use lone if exports transcend acceptable quotas.

LISTEN | Does proviso absorption assistance oregon wounded Canada-U.S. commercialized talks? 

Kelly Ann Shaw, a erstwhile elder White House commercialized adviser, said she's not amazed that Trump continues to rise proviso absorption arsenic an issue.

CUSMA contains a sunset clause which says that the 3 countries reconvene each six years to renegotiate parts of the statement "that whitethorn not beryllium moving the mode that they were primitively intended," said Shaw.

"So that's the ailment that you spot present from the administration — we're gearing up to renegotiate this deal, truthful we're identifying things wherever we don't consciousness similar we're being treated well."