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The Trump administration plans to impose new tariffs on dozens of trading partners, including Canada, over allegations that the countries are allowing goods made with forced labor into their supply chains.
It’s the latest move by the White House to replace sweeping tariffs struck down by the U.S. Supreme Court in February.
The proposed new tariffs were announced by U.S. Trade Representative Jamieson Greer late Tuesday evening, not long after he concluded an afternoon meeting with Canada-U.S. Trade Secretary Dominic LeBlanc in Washington.
“The failure of our key trading partners to address the importation of goods produced with forced labor is unacceptable,” Greer said in a news release.
Greer proposes a 10 percent tariff on exports from Canada. They would only apply to goods that do not comply with the Canada-US-Mexico Agreement (CUSMA) rules of origin. That means nearly 90 percent of Canadian exports to the U.S. would be exempt from the tariff.
The wording of the official announcement from Greer’s office describes it as an additional tariff, suggesting it would be on top of an existing 10 percent tariff on Canadian exports that are not CUSMA-compliant. This tariff expires on July 24th.
VIEW | Carney downplays the impact of the new “forced labor” tariff:
Carney says CUSMA spares most Canadian trade from proposed U.S. tariffs on forced labor
The United States is proposing a new tariff of 10 to 12.5 percent for dozens of countries, including Canada, amid accusations that they have failed to enforce a ban on forced labor. Prime Minister Mark Carney said the rationale behind the tariff is “something we share” and that it will have “no impact” on the “vast majority” of Canadian trade due to a CUSMA carveout.
Under U.S. law, the president has the authority to impose tariffs on countries if an investigation finds their trade practices to be unfair and harmful to U.S. commerce.
The U.S. Trade Representative’s office launched an investigation in March to examine whether 59 countries and the European Union actually ban imports of goods made with forced labor.
Allegations of forced labor are “absurd,” says EU official
Tuesday night’s press release said all 60 had failed to meet the requirements, prompting skeptics to question the fairness of the U.S. investigation into forced labor.
“This looks very much like an attempt to turn the facts into a legal justification for tariffs that have already been decided,” Bernd Lange, chairman of the European Parliament’s Trade Committee, posted on social media.
“The EU has adopted the strictest rules in the world against products made with forced labor,” said Lange. “To accuse the EU of not doing enough to combat forced labor is absurd.”
Greer has now proposed a list of tariff rates that would apply to each trading partner.
Fifteen other U.S. trading partners would also face a 10 percent tariff as part of the forced labor investigation. These include the European Union, the United Kingdom, Argentina, El Salvador, Bangladesh and Pakistan.
The remaining 44 countries – including Japan, Singapore, India, South Korea and Vietnam – face a tariff of 12.5 percent.
The U.S. investigation justifying the proposed new tariffs says the Canada Border Services Agency “does not appear to release official statistics or other information about its enforcement efforts” against imported goods made with forced labor. (CBSA)
The Trump administration cannot impose the tariffs immediately. It must go through a period of public comment and review, starting with hearings in July.
The US Trade Representative’s (USTR) 92-page investigative report includes a section that substantiates its claim that Canada is “not effectively enforcing” its own ban on forced labor imports, which came into effect in 2020.
“The number of enforcement actions Canada has taken to prevent the importation of forced labor goods is minimal.”
2 shipments were refused entry into Canada within 6 years
The Canada Border Services Agency “does not appear to release official statistics or other information regarding its enforcement efforts,” the USTR says.
“The limited information available on law enforcement statistics suggests that Canadian authorities intercepted only 50 shipments on suspicion of forced labor between 2020 and 2026, with only two shipments ultimately banned from importation,” it said.
The report compares the Canadian numbers with U.S. Customs and Border Protection, which denied entry to more than 6,300 shipments in 2024 alone for violating the Uyghur Forced Labor Prevention Act, which targets goods made by ethnic minorities in China’s Xinjiang region.
While the Trump administration’s move to impose tariffs against Canada over the forced labor issue is new, there have been complaints about the practice in the U.S. long before his return to the White House, and the Republican president is not the only one to complain.
- During negotiations that led to the signing of CUSMA in 2018, the U.S. pushed Canada and Mexico to agree to adopt their own laws banning the importation of goods produced using forced labor.
- In 2022, a Liberal MP predicted that the US could retaliate against Canada for failing to stop imports of goods made with forced labor.
- In 2024, a Democratic senator who helped draft the United States’ forced labor law told CBC News he was concerned that Canada’s lack of enforcement was creating a backdoor for the importation of forced labor products into the United States