PM Carney announces removal of counter-tariffs in latest phase of negotiations with the United States

Today, Prime Minister Mark Carney announced that the Government of Canada will be removing a series of counter-tariff measures placed on the United States as the latest step in negotiating a final trade and security deal. The announcement came a day after Carney spoke with U.S. President Donald Trump, marking their first conversation since missing the previously self-imposed August 1 deadline to reach a deal or at least a framework.

Carney emphasized that Canada’s current tariff rate from the U.S. stands at 5.6 percent under the Canada-United States-Mexico Agreement (CUSMA) protections, well below the 16 percent global average applied in U.S. trade agreements with the EU and other partners. “Canada currently has the best trade deal with the United States,” he said, noting that while the terms have evolved, they remain more favorable than those secured by other countries. On this basis, Carney announced that Canada will remove all tariffs consistent with CUSMA compliance, effective September 1, 2025. Tariffs on U.S. autos, steel, and aluminum will remain in place on those industries in Canada. “We have now re-established free trade on the majority of our goods,” Carney added. “Our focus is squarely on these strategic sectors and our future.”

Carney also signaled forthcoming consultations to assess Canada’s priorities in the shifting global trade environment. He said that following his conversation with President Trump, negotiations are once again intensifying toward a final agreement on key sectors. He reaffirmed his government’s commitment to “Building Canada Strong” and noted that the first in a series of nation-building projects, developed in collaboration with provincial premiers, will be announced soon.

In response to questions about the impact on steel, aluminum, and auto workers, Carney highlighted business liquidity measures already in place, new procurement programs to support steel workers, and a forthcoming industrial strategy to be unveiled in early September addressing all sectors affected by the global tariff system.

Sussex will continue to monitor developments closely. To discuss next steps or opportunities to participate in the forthcoming consultations, please contact your Sussex consultant or reach out directly to Devin McCarthy, Partner and Federal Practice Lead, at dmccarthy@sussex-strategy.com