Trump Removes 50% Tariffs on Some Canadian Goods but Adds 100 Product Categories as U.S. Midterms Approach

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President Donald Trump is reshuffling one of the most aggressive pieces of his trade campaign against Canada just as economic anxiety becomes a defining issue in the U.S. midterm elections. A proclamation signed October 23 will remove certain Canadian products from an additional 50% tariff while placing 100 new tariff classifications under the same levy beginning October 30.

The change offers meaningful relief to industries that rely on Canadian plywood, packaging, refrigeration equipment, agricultural machinery and other specialized products. But it is far from a broad retreat. Washington is simultaneously extending the 50% charge to products ranging from cocoa preparations and shampoo to carpets, tools and air conditioners, leaving the wider Canada-U.S. trade confrontation firmly in place.

The Tariff List Is Being Rewritten, Not Dismantled

The most important distinction is that Trump has not reduced the 50% Section 338 tariff rate itself. Instead, the administration is changing which Canadian products fall under it. Effective at 12:01 a.m. Eastern time on October 30, 22 Harmonized Tariff Schedule classifications will be removed from the list, while 100 classifications will be added. The exemptions include selected plywood, plastic and paper packaging, refrigeration equipment, packing machinery, agricultural sorting equipment and edible seaweed and algae. For businesses handling those goods, that can represent a substantial change in the landed cost of Canadian imports.

The additions are considerably broader in number. They include multiple classifications of cocoa powder, paints and varnishes, shampoo, chemicals, flooring, carpets, certain wood and paper products, hand-operated valves, power tools, chest freezers, window air conditioners, canoes and specialized equipment. Calling them 100 “product categories” is convenient shorthand, but technically they are 100 individual HTS classifications. Several closely related classifications can belong to the same broader commercial category, which is why the number should not be interpreted as 100 entirely separate industries suddenly being targeted.

Maine Farmers Won a Targeted Break

One of the clearest beneficiaries is Maine, where Republican Senator Susan Collins had repeatedly pushed the administration to reduce tariffs on Canadian products that local farmers and businesses said were difficult or expensive to replace domestically. Collins said nine broader categories receiving relief are important to blueberry, potato, apple and seaweed producers. Those include corrugated cartons, plastic crates and packing bags, refrigeration equipment, packing machinery and agricultural cleaning or grading equipment.

The practical problem was less abstract than a debate over trade theory. A blueberry grower that depends on specialized Canadian harvesting boxes cannot necessarily switch to an American supplier overnight simply because a tariff has made the imported product more expensive. Collins has said many Maine businesses face precisely that problem. Her office previously estimated that Maine imports roughly $2 billion in non-petroleum goods from Canada each year. The latest exemptions therefore give her a tangible policy victory to point to in rural and coastal communities, even as she continues arguing that the administration should pursue a broader trade agreement rather than forcing individual industries to seek exemptions one product at a time.

The Relief Is Economically Larger Than the New Additions on Paper

The numerical imbalance between 22 classifications removed and 100 added makes the policy initially look like an escalation. Trade value tells a somewhat different story. A Global News analysis using 2025 U.S. trade figures estimated that the Canadian products receiving relief represented approximately $5.1 billion in trade, compared with roughly $2.6 billion for the products being newly subjected to the 50% tariff. Those figures measure historical trade value rather than the amount of tariff revenue the government will collect, but they illustrate why a relatively small number of exemptions can still matter economically.

They should also be viewed against the size of the entire relationship. U.S. goods trade with Canada totaled about $715.5 billion in 2025, including $381.9 billion of Canadian goods entering the United States. Even targeted tariff adjustments can ripple through that enormous commercial network. Federal Reserve research examining recent U.S. tariffs found that roughly 26% of tariff increases eventually passed through to consumer prices, while most of the initial increase showed up rapidly in import prices. That helps explain why American farmers, manufacturers and retailers relying on Canadian inputs have increasingly joined exporters in demanding relief.

An Obscure 1930 Law Has Become a Powerful Trade Weapon

The 50% duties are being imposed under Section 338 of the Tariff Act of 1930, an authority that received little public attention for decades. Congressional Research Service analysis says Trump’s 2026 actions against Canada marked the first time a president expressly cited Section 338 to impose tariffs. The statute allows the president to respond when another country is judged to discriminate against U.S. commerce and permits additional duties of as much as 50%. Under certain circumstances, it also allows imports to be excluded altogether.

That authority helps explain why the tariff list can change so quickly. Section 338 permits the president to suspend, revoke, supplement or amend an earlier proclamation when the administration determines that doing so serves the public interest. The White House argues that Canada has treated U.S. commerce unfairly in areas involving motor vehicles, dairy and alcoholic beverages. Ottawa disputes important parts of that characterization. Another unusual feature is that Canadian goods covered by these Section 338 measures do not escape the additional tariff simply because they qualify for preferential treatment under the U.S.-Mexico-Canada Agreement. That has weakened one of the protections North American companies normally rely on when planning cross-border production.

Canada’s Retaliation Is Still Shaping the Standoff

The October exemptions come after months of escalation. When Washington’s new Section 338 tariffs took effect in August, Canada responded with counter-tariffs covering C$27.6 billion of American imports. Ottawa introduced rates of 15%, 25% and 50% across targeted products, generally matching the corresponding U.S. action. The affected sectors included steel, dairy, appliances, agricultural equipment, paper, wood products, furniture, plastics and electronics. Washington subsequently broadened its own measures and imposed outright import restrictions on selected Canadian goods.

The economic consequences extend well beyond the products named on customs lists. Canada’s Parliamentary Budget Officer estimated in October that recent trade measures had pushed the trade-weighted effective U.S. tariff rate on Canadian imports from 5.3% to 7.7%. In a longer-term scenario where the trade barriers persist, the PBO estimated Canada’s real GDP could be about 1.4% lower after five years than under a pre-tariff baseline, with employment losses potentially reaching 185,000 at their peak. Those are modeled estimates rather than predictions of inevitable outcomes, but they help explain why Ottawa views targeted American exemptions as useful without treating them as resolution of the broader dispute.

Steel and Auto Tariffs Remain the Much Bigger Negotiating Prize

The products affected on October 30 are only one layer of a far more complicated tariff structure. Separate U.S. measures under Section 232 continue to affect strategic Canadian industries, including tariffs of up to 50% on steel and a 25% tariff on automobiles. Those measures carry greater political and economic significance because Canadian and American manufacturing operations are deeply integrated, particularly in Ontario, Michigan and other Great Lakes manufacturing centres.

That is why the most consequential negotiations are now taking place outside the October 23 product-list adjustment. U.S. and Canadian officials are discussing possible relief from steel and auto tariffs, with Commerce Secretary Howard Lutnick and Canadian Trade Minister Dominic LeBlanc among the central figures. Reuters reported this week that officials were considering whether some form of agreement could emerge before the November 3 elections, although Washington continues to seek concessions from Canada. Prime Minister Mark Carney has said contacts have intensified, but he has framed any progress as evidence that the United States is moving closer to Canada’s position. A limited sectoral arrangement therefore remains possible without producing a comprehensive settlement.

Midterm Politics Make the Timing Impossible to Ignore

The tariff changes take effect October 30—just four days before Americans vote in the November 3 midterms. That timing matters because tariffs have become a political liability in several northern states with close economic relationships with Canada. Maine is particularly important. A Marist poll released October 27 found Democratic challenger Troy Jackson at 49% and Collins at 47% among likely voters, a two-point difference within the poll’s relatively wide margin of error. The same survey found 58% of likely Maine voters disapproved of Trump’s job performance, while 46% said their personal finances had worsened during the previous year.

National sentiment adds to the pressure. An AP-NORC poll conducted in late September found 64% of American adults believed Trump had gone too far in imposing new tariffs, while only about three in ten approved of his handling of trade negotiations. Collins has positioned herself as an internal Republican critic capable of securing practical exemptions for Maine. Jackson’s counterargument is that requesting relief after tariffs raise costs does not resolve the underlying policy. The October tariff adjustment now gives both campaigns fresh evidence for those competing narratives.

October 30 Will Bring Relief for Some Companies and New Bills for Others

For Canadian exporters and their U.S. customers, the immediate task is far less political: determining exactly where their products fall in the Harmonized Tariff Schedule. Section 338 exposure is determined by customs classification rather than by a company’s general industry. A manufacturer may therefore discover that one product line remains unaffected while another closely related item faces an additional 50% duty. Canadian trade guidance specifically warns exporters that qualifying under CUSMA does not automatically exempt a product from the Section 338 surcharge.

The October 30 proclamation also makes clear that applicable Section 338 duties can operate alongside duties imposed under other U.S. trade authorities, including Section 232 where relevant. That means the headline description of a product as “exempt” requires caution: the 22 classifications leaving the latest Section 338 list are being relieved of this particular additional 50% charge, but other ordinary or special duties may still apply. Likewise, the 100 newly covered classifications will face their new treatment based on goods entered for consumption or withdrawn from warehouse beginning at 12:01 a.m. Eastern time. For companies moving goods across the border, tariff classification, entry timing and the interaction between separate trade measures may matter almost as much as the political negotiations occurring in Washington and Ottawa.

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