President Donald Trump Just Paused Tariffs on Some Goods From Canada and Mexico for One Month. Here’s What We Know.
Here’s how Trump’s tariffs will affect consumers in the U.S.
Key Takeaways
- On Tuesday, the Trump Administration implemented 25% tariffs on imports from Canada and Mexico and a 20% tariff on goods from China.
- In response, Canada, China, and Mexico enacted tariffs on imported U.S. goods.
- On Thursday, Trump paused tariffs on some goods from Canada and Mexico covered by the USMCA treaty.
President Donald Trump signed executive orders Thursday that for about one month on some products from Mexico and Canada covered by the United States-Mexico-Canada Agreement (USMCA).
Trump negotiated the USMCA treaty , which made the three countries a free trade zone.
On Truth Social, Trump wrote: “After speaking with President Claudia Sheinbaum of Mexico, I have agreed that Mexico will not be required to pay Tariffs on anything that falls under the USMCA Agreement.”
Tariffs would be delayed until April 2, per the executive actions.
On Wednesday, Trump exempted auto tariffs from Mexico and Canada .
However, a White House official confirmed to CNBC that the to about 50% of Mexican imports and more than 60% of Canadian goods.
Original story from March 4, 2025:
President on goods from Mexico and Canada on Tuesday, along with a doubling of tariffs on some Chinese imports to 20%.
In response, Canada imposed on nearly $100 billion of imported U.S. goods on Tuesday, including machinery, auto parts, and alcohol, and Ontario is enacting a 25% tariff on its energy export — the province in Minnesota, New York, and Michigan, per Bloomberg.
China also enacted tariffs on Tuesday — 10% to 15% on U.S. agricultural products and against the new tariffs with the World Trade Organization.
Mexico will announce its countermeasures
Canada and Mexico have had essentially tariff-free trading agreements with the U.S. for three decades, per . However, China and the U.S. have engaged in since 2018.
So far, the news has stocks.
Here’s what we know about the tariffs and how they could affect consumers and businesses in the U.S.
Why is Trump implementing tariffs?
In an signed on Monday, Trump stated the tariffs are meant to reduce the U.S. trade deficit and fight the ongoing fentanyl crisis.
Trump has stated that he is implementing tariffs to pressure Canada, Mexico, and China into stopping drugs like fentanyl from entering the U.S., per . According to the , nearly 70% of the 107,000 deaths from drug overdoses in 2023 involved opioids such as fentanyl.
Trump wrote in the executive order that China’s “failure” to “blunt the sustained influx of synthetic opioids, including fentanyl” presented “an unusual and extraordinary threat” and that he would increase tariffs in response.
The Trump administration says it is also using tariffs as a way to secure the border and stop the flow of undocumented immigrants from Mexico and Canada.
In a in November, Trump said that the tariffs on goods would “remain in effect” until “Drugs, in particular, Fentanyl” and “all Illegal Aliens stop this Invasion of our Country!”
Related: 3 Reasons Trump May Be Softening His Protectionist Stance and How This Helps Startups
What are tariffs and what will they mean for consumers?
Tariffs are taxes placed on goods imported from other countries. For example, a 20% tariff on Chinese goods means a $10 product would have a $2 tax added to the price. The importer would have to pay the tax and Border Protection when the product crosses the border.
Companies can absorb the additional charge or pass it on to customers in the form of increased prices.
The CEOs of Target and Best Buy have already indicated the companies will raise prices for consumers in response to the tariffs.
Target CEO Brian Cornell Tuesday that produce prices would increase over the next few days as tariffs take effect. Cornell noted that Target depends on produce from Mexico in the winter, so shoppers could see prices rise for fruits and vegetables like strawberries and avocados.
Also on Tuesday, Best Buy CEO Corie Barry said on the company’s earnings call that American consumers were “” to see price increases in response to the tariffs. Best Buy sources about 55% of its products from China and 20% from Mexico, Barry stated.
However, Chipotle CEO Scott Boatwright told NBC on Sunday that the company the costs of tariffs and only raise prices if elevated costs turn out to be significant.
What are the benefits of tariffs?
The U.S. imported goods and services in 2024 than it exported. of imports overall came from China, Canada, and Mexico.
According to the , tariffs benefit domestic producers by raising the U.S. prices of foreign goods relative to comparable goods produced domestically. Domestic companies also do not have to pay tariffs on the goods they produce and sell within the country.
Trump underscored this point on Tuesday: “If companies move to the United States, there are no tariffs!!!”
Tariffs can also increase government revenue. The Committee for a Responsible Federal Budget, a nonpartisan, non-profit organization, that 25% tariffs on imports from Canada and Mexico would increase government revenue by $110 billion across the rest of the year. If the tariffs are made permanent, they would raise $1.3 trillion in revenue in the next ten years.
Still, experts at the Peterson Insitute for Internal Economics, an independent, nonprofit, and nonpartisan research organization say that tariffs .
Related: Here’s How Donald Trump’s Victory Will Impact Small Businesses
Key Takeaways
- On Tuesday, the Trump Administration implemented 25% tariffs on imports from Canada and Mexico and a 20% tariff on goods from China.
- In response, Canada, China, and Mexico enacted tariffs on imported U.S. goods.
- On Thursday, Trump paused tariffs on some goods from Canada and Mexico covered by the USMCA treaty.
President Donald Trump signed executive orders Thursday that for about one month on some products from Mexico and Canada covered by the United States-Mexico-Canada Agreement (USMCA).
Trump negotiated the USMCA treaty , which made the three countries a free trade zone.
On Truth Social, Trump wrote: “After speaking with President Claudia Sheinbaum of Mexico, I have agreed that Mexico will not be required to pay Tariffs on anything that falls under the USMCA Agreement.”
