Companies, consumers, and farmers across North America prepared on Friday for U.S. President Donald Trump to impose 25% tariffs on Canadian and Mexican imports, a move that could disrupt nearly $1.6 trillion in annual trade.
Trump set a Saturday deadline to implement the tariffs, tying the decision to demands that Canada and Mexico take stronger measures to curb illegal immigration and the flow of fentanyl and its precursor chemicals into the US.
On Thursday, Trump said he was also considering an additional 10% tariff on Chinese imports as punishment for Beijing’s role in the crisis.
Industry groups scrambled for details on how the tariffs would be implemented—whether Trump would impose the full 25% immediately or announce them with a delay to allow for negotiations. Even an immediate decision would require two to three weeks of public notice before US Customs and Border Protection could begin collections, based on previous tariff actions.
Trump also indicated he was weighing whether to apply tariffs to imports of Canadian and Mexican oil, a move that could impact gasoline prices. According to US Census Bureau data, crude oil is the top US import from Canada and among the top five from Mexico.
Trump’s top trade adviser, Peter Navarro, said on Friday that revenue from the tariffs would help finance an extension of Trump’s 2017 tax cuts, which total about $4 trillion and are set to expire this year.
“President Trump has a great new tax cut, the largest in history, and tariffs can easily pay for that,” Navarro said on CNBC.
Two sources familiar with the matter said Trump was expected to invoke the International Emergency Economic Powers Act (IEEPA) as the legal basis for the tariffs.
The move would allow him to declare a national emergency over the fentanyl crisis, which caused nearly 75,000 deaths in the US in 2023, and illegal immigration.
Enacted in 1977 and expanded after the 9/11 attacks, the IEEPA grants the president broad authority to impose economic sanctions in response to a crisis. Among Trump’s available trade law tools, IEEPA offers the fastest path to implementing broad tariffs, as other methods require lengthy investigations by the Commerce Department or the US Trade Representative’s office.
Trump’s nominees to lead those agencies—Wall Street CEO Howard Lutnick and trade lawyer Jamieson Greer—have yet to be confirmed by the US Senate. In 2019, Trump used IEEPA to support a tariff threat against Mexico over border security issues.
Faridah Abdulkadiri
Follow us on:
