The White House has issued an order increasing tariffs on certain Canadian products in response to ongoing concerns about the flow of illicit drugs, particularly fentanyl, across the northern border. The measure, signed by President Donald J. Trump on July 31, 2025, raises the additional ad valorem rate of duty from 25 percent to 35 percent for specific Canadian goods.
According to the order, this action follows recommendations from senior officials who reported a lack of sufficient cooperation from Canada in addressing drug trafficking organizations and related criminal activity at the border. The administration cited continued public health risks associated with fentanyl and other illicit substances as well as Canada's retaliatory measures against previous U.S. tariffs.
"Should Canada retaliate against the United States . . . through import duties on United States exports to Canada or similar measures," President Trump stated in reference to earlier executive orders, "I may increase or expand in scope the duties imposed . . . to ensure the efficacy of th[e] action taken."
The revised tariff rates will take effect for goods entered or withdrawn for consumption starting August 1, 2025. Under the new rules, any articles found by U.S. Customs and Border Protection (CBP) to have been transshipped—moved through third countries to evade tariffs—will be subject to a higher duty rate of 40 percent along with possible fines and penalties.
Additionally, every six months authorities will publish a list identifying countries and facilities involved in schemes intended to circumvent these trade measures.
The order maintains existing exemptions for goods qualifying under the United States-Mexico-Canada Agreement (USMCA), but strengthens enforcement mechanisms against those attempting to avoid tariffs through transshipment or other means.
President Trump emphasized that these steps are necessary due to what he described as "Canada’s lack of cooperation in stemming the flood of fentanyl and other illicit drugs across our northern border — including its failure to devote satisfactory resources to arrest, seize, detain, or otherwise intercept drug trafficking organizations."
Under this directive, agencies including Homeland Security and Commerce are authorized to adopt further regulations if needed and coordinate monitoring efforts at the northern border. Any changes will be published officially as required.
The announcement comes amid ongoing concerns about cross-border drug smuggling between Canada and the United States—a topic that has prompted several policy actions over recent years.
