Should President-elect Donald Trump follow through on his promise to impose a new 25% tariff on goods imported from Canada, the United States’ northern neighbor has vowed to retaliate in a trade war that could prove costly for American consumers.
On Thursday, the Daily Beast reported that outgoing Canadian Prime Minister Justin Trudeau is contemplating a forceful response to the incoming administration’s tariff threat. Trudeau reportedly said that “everything is on the table” for potential new import duties for the U.S. including orange juice, toilets and steel products, among others.
The Beast noted that Canada imports roughly 360 tons of orange juice from the U.S., which primarily comes from Trump’s adopted new home state of Florida. The prospect of new tariffs on American imports is not unprecedented, as Canada has already imposed additional import taxes on Kentucky whiskey and dairy products from Wisconsin.
READ MORE: ‘Everything will go through the roof’: Americans stock up in preparation for Trump tariffs
Trump has argued that the tariffs are necessary in order to crack down on illegal immigration and drug smuggling, and that the costs would be paid by other countries, rather than American consumers. But Walmart – one of the world’s largest retailers — has already warned that Americans should be prepared for higher prices if new tariffs are passed, given that imported goods make up a bulk of its inventory.
Should Trump’s 25% tariff be fully passed onto consumers, it could result in significant price spikes for items Americans buy every day. This includes gas prices, as roughly 60% of the U.S. crude oil supply is imported from Canada. It could also be more expensive for Americans to heat their homes this winter, as the United States imports a significant amount of natural gas from the north, along with uranium for nuclear power plants.
The Guardian reported last week that some Americans are already stocking up on imported goods ahead of Trump assuming his second term. This includes items from Canada and Mexico — the latter of which could also have its imports taxed at another 25% — along with China. While the 10% surcharge on Chinese-made goods would make consumer electronics more expensive like smartphones, laptop computers and video game consoles, some Americans are also buying grocery items in bulk that are typically imported from Mexico.
Trudeau has said he would not run for another term as prime minister, with polls showing his party expected to suffer major losses to the Conservative Party as other incumbent parties have in the wake of pandemic-era inflation rates. It remains unclear if Trudeau’s eventual replacement would retaliate against Trump if he follows through on his tariff threat.
READ MORE: ‘Not immune’: Walmart confirms new tariffs will mean higher prices for customers
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