Canada and US trade war escalates as tariffs take effect

Canada will announce retaliatory tariffs against the US on Tuesday after talks failed to avert new 50 percent US tariffs on Canadian goods, escalating a trade war between the neighbours. The US levies, effective Saturday, target about $20 billion in Canadian exports annually, including hockey sticks, wine, cement and agricultural products. Canada's Prime Minister Mark Carney promised "dollar for dollar" countermeasures starting September 8, targeting US steel, dairy and appliances. The tariffs use a never-before-invoked 1930 law, Section 338, requiring no investigation. Trump threatened further auto tariffs by 2027, while Ontario Premier Doug Ford warned of cutting electricity and critical minerals. Economists say costs will trickle down to consumers through higher prices.