Commerce Intelligence Alerts

Canada Announces Countermeasures In Response to US Section 338 Tariffs Effective Sep 8, 2026

Written by Whit Bolland | Sep 2, 2026, 9:51:49 PM

Summary

Effective September 8, 2026, Canada will apply new tariffs of 15%, 25%, or 50% on a range of U.S.-origin goods imported into Canada.

The measures are Canada's dollar-for-dollar response to the U.S. Section 338 tariffs on Canadian-origin goods. They cover products drawn from the U.S. Section 338 and Section 232 lists and apply to roughly $27.6 billion in U.S. imports, focused on sectors including steel, dairy, appliances, agricultural equipment, pulp and paper, and electronics. Several categories that FlavorCloud merchants ship most, including beauty and apparel, land in the 50% band.

Why It Matters

For any merchant shipping U.S.-origin goods into Canada, this changes landed cost overnight. A product that carried no counter-tariff on September 7 can carry a 50% additional tariff on September 8, in addition to regular duties and fees.

The new measures also stack on existing countermeasures. Canada's 25% tariffs on U.S.-origin vehicles, automotive products, and raw iron and steel, in place since September 1, 2025, remain active. Notably, primary steel and aluminum products that were previously subject to the 25% counter-tariff move up to 50% under the new list.

The practical effect: merchants selling into Canada may need to reassess landed cost, margin, and customer-facing pricing before the tariffs take effect. FlavorCloud's landed cost engine is being updated to reflect the new tariff rates so duties, tariffs, and taxes calculate correctly and total costs display accurately at checkout for Canada-bound shipments.

Who It Affects

This affects businesses importing covered U.S.-origin goods into Canada. Rates are assigned by product. Review the actual tariff-item list to confirm exposure.

 

50% tariff

  • Cosmetics, perfumes, beauty products, and hair care products
  • Furniture, clothing, apparel, and paper products
  • Food products including malt, honey, molasses, and dairy
  • Lumber and wood products
  • Primary steel and aluminum products (up from 25% previously), electronics, tools, steel and aluminum derivative goods, hardware, fasteners, chain, and construction equipment

25% tariff

  • Table and kitchenware, textiles, carpets, paper products, and silverware or cutlery
  • Cars, motor vehicles, automotive products, tools, electronics, appliances, and transportation equipment
  • Fasteners, hardware fixtures and fittings
  • Dairy products, fish, and seafood
  • Certain steel and aluminum derivative products

15% tariff

  • Raw aluminum and steel products, vehicles, industrial equipment, and machinery

When It Hits

The tariffs take effect at 12:01 a.m. on September 8, 2026. U.S. goods already in transit to Canada on that day are not subject to the new measures.

Canada's existing counter-tariffs from September 1, 2025 continue to apply alongside the new list. The government has not announced an end date for either set of measures.

What You Should Do Now

  • Review the tariff classifications of all U.S.-origin products you ship into Canada.
  • Compare those classifications against Canada's complete counter-tariff list to confirm the applicable rate.
  • Do not rely on sector names; the lists include products beyond the named industries.
  • Check whether any products already fell under the September 1, 2025 measures, and note the rate changes (for example, primary steel and aluminum moving to 50%).
  • Review pricing, margin, sourcing, and inventory plans ahead of the effective date.

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