Slapping Tariffs on Canada to Stop Fentanyl from the North?
Published Date: 2/7/2025
Presidential Document
Summary
The U.S. is cracking down on illegal drugs coming through the northern border by adding new duties (taxes) on certain imports from Canada. This move targets drug traffickers and aims to stop dangerous drugs like fentanyl from flooding American communities. The changes start soon and could impact trade costs, pushing Canada to step up efforts against drug smuggling.
Analyzed Economic Effects
6 provisions identified: 0 benefits, 6 costs, 0 mixed.
25% Duty on Canadian Products
If you buy goods that are products of Canada, those goods will be subject to an additional 25 percent ad valorem duty starting for items entered or withdrawn for consumption on or after 12:01 a.m. Eastern Time on February 4, 2025. The order says this 25% duty is in addition to any other duties, fees, or charges and goods loaded or in transit before 12:01 a.m. Eastern Time on February 1, 2025 may be exempt if the importer certifies to CBP as specified.
10% Duty on Canadian Energy Products
Energy and energy resources that are products of Canada will be subject to an additional 10 percent ad valorem duty for goods entered or withdrawn for consumption on or after 12:01 a.m. Eastern Time on February 4, 2025. The same transit/loading exception for shipments before 12:01 a.m. Eastern Time on February 1, 2025 applies if the importer certifies to CBP as specified.
No Duty-Free De Minimis for Covered Imports
Duty-free de minimis treatment under 19 U.S.C. 1321 will not be available for the articles covered by this order, meaning small shipments of those Canadian products will not qualify for the usual duty-free exemption. This change applies to articles described in the order when entered or withdrawn on or after 12:01 a.m. Eastern Time on February 4, 2025.
No Drawback Allowed on These Duties
Importers and manufacturers cannot claim drawback (a refund) for the duties imposed by this order on covered Canadian articles; the order explicitly states that no drawback shall be available for these duties. This applies to entries on or after 12:01 a.m. Eastern Time on February 4, 2025.
Tariffs May Increase If Canada Retaliates
The President may increase or expand the duties imposed under this order if Canada retaliates through import duties on U.S. exports to Canada or similar measures. Any such increases would be intended to ensure the efficacy of the action described in this order.
Foreign Trade Zone Treatment Changed
Canadian products subject to the duties that are admitted into a U.S. foreign trade zone on or after 12:01 a.m. Eastern Time on February 4, 2025 must be admitted as "privileged foreign status" and will be subject to the applicable HTSUS duty rates upon entry for consumption. This affects merchandise placed into foreign trade zones after that date.
Personalized for You
How does this regulation affect your finances?
Personalize government policy and PRIA will tell you what this federal register document means for your household, plus every other regulation we track. PRIA reads each provision against your financial profile to show you exactly what matters to your wallet.
Key Dates
Department and Agencies
Related Federal Register Documents
2026-18835, Excluding Certain Canadian Products From Importation Into the United States in Response to Continued Discrimination Against the Commerce of the United States With Respect to Alcoholic Beverages
The U.S. is blocking some Canadian products from coming in because Canada is unfairly stopping American alcoholic drinks from being sold there. This move hits Canadian imports to balance the playing field and protect U.S. businesses. The changes start right away and could affect trade money flows between the two countries.
2026-18837, Excluding Certain Canadian Products From Importation Into the United States in Response to Continued Discrimination Against the Commerce of the United States With Respect to Motor Vehicles
The U.S. is putting extra taxes on some Canadian motor vehicles and parts because Canada is treating American car products unfairly. These new rules started on August 22, 2026, after Canada stopped trying to fix the problem. This affects Canadian exporters and could make their products more expensive in the U.S., protecting American businesses.
2026-18839, Modifying the Scope of Products of Canada Subject to the Additional Duties Imposed To Offset Canadian Discrimination Against the Commerce of the United States With Respect to Motor Vehicles
The U.S. is keeping extra taxes on some Canadian motor vehicles and parts because Canada isn’t playing fair with U.S. car exports. These extra duties started August 22, 2026, after Canada broke a promise to fix the problem. This affects Canadian exporters and aims to protect American businesses from unfair trade practices.
2026-18836, Excluding Certain Canadian Products From Importation Into the United States in Response to Continued Discrimination Against the Commerce of the United States With Respect to Dairy
The U.S. is blocking some Canadian dairy products from entering the country because Canada is treating American cheese unfairly with extra fees. After Canada promised to fix this but backed out, the U.S. put extra taxes on Canadian goods starting August 22, 2026. This move aims to protect American dairy businesses and keep trade fair.
2026-18838, Modifying the Scope of Products of Canada Subject to the Additional Duties Imposed To Offset Canadian Discrimination Against the Commerce of the United States With Respect to Alcoholic Beverages
The U.S. is keeping extra taxes on some Canadian products because Canada is unfairly blocking American alcoholic drinks while letting others in. After a brief pause hoping Canada would fix this, they didn’t, so the taxes started on August 22, 2026. This affects Canadian exporters and aims to protect American businesses from unfair treatment.
2026-18738, Accelerating Access to Veterans' Benefits and Employment Opportunities
This new order helps veterans get their benefits and jobs faster by fixing slow and messy record-sharing between the military and Veterans Affairs. Within 180 days, updated tech and smart digital tools will make it easier for veterans to apply for healthcare, education, and job training. This means less waiting and smoother transitions for millions of veterans, with no extra cost delays.
Previous / Next Documents
Previous: 2025-02405, Continuation of the National Emergency With Respect to the Situation in and in Relation to Burma
The U.S. is extending its national emergency over the situation in Burma for another year because the military coup and ongoing unrest still threaten peace and democracy. This means sanctions and restrictions on Burma’s military leaders and related groups stay in place, affecting trade and financial dealings. The extension lasts through February 10, 2026, keeping pressure on Burma’s government to respect human rights and democracy.
Next: 2025-02407, Imposing Duties To Address the Situation at Our Southern Border
The U.S. is putting new taxes (duties) on goods from Mexico to fight illegal immigration and drug smuggling that harm American communities. These changes target Mexican drug cartels and human traffickers who hurt our safety and health. The duties start soon and aim to protect our borders, schools, and hospitals while sending a strong message to Mexico to step up.