Canadian businesses are commencing operations on Tuesday under the latest federal government’s dollar-for-dollar tariffs on $28 billion worth of U.S. imports. While business owners prepare for increased costs and potential supply chain disruptions, experts suggest that consumers might not feel a significant impact.
The new tariffs came into effect at 12:01 a.m. Tuesday, affecting nearly 700 American products with rates ranging from 15% to 50%. The impacted items range from basic commodities like steel and aluminum to household necessities such as toilet paper and specialized products like coin-operated arcade games.
These tariffs are a retaliatory measure by the Canadian government in response to the 50% tariffs imposed by U.S. President Donald Trump’s administration on August 22 on various products worth over $28 billion, including items like plywood, cement, wine, and hockey sticks.
Dan Kelly, the president of the Canadian Federation of Independent Business (CFIB), representing over 100,000 small and medium-sized enterprises nationwide, expressed concerns about members feeling marginalized in the current trade dispute with the United States.
JS Furniture, a Manitoba-based retailer of home furnishings and appliances with multiple locations, estimates that about 60% of their sales by volume come from American goods. General manager Brian Kyca highlighted the potential impact on bedroom furniture due to the tariffs, with larger items facing a 50% tariff and smaller items a 25% tariff.
Kyca mentioned the challenges of assessing the impact, with limited information available from agencies like the Canada Border Services Agency. Despite planning to absorb the higher costs for now, JS Furniture aims to negotiate deals with manufacturers to mitigate the impact on customers.
Colin Mang, an economics professor at McMaster University, noted that businesses across Canada are grappling with balancing absorbing tariff costs and passing them on to consumers to maintain profitability.
New tariffs are expected to have a limited impact on the average Canadian’s daily life, according to experts. Bank of Canada Governor Tiff Macklem highlighted that while tariffs may increase costs for some businesses, they are applied to a narrow range of products.
The ongoing trade tensions have stalled JS Furniture’s expansion plans, impacting employees, especially those reliant on commissions. Mang emphasized that the new tariffs focus on U.S. goods with domestic alternatives, providing Canadian companies an opportunity to seize a larger share of the local market.
Overall, experts believe that the new tariffs are unlikely to significantly affect most Canadians in their day-to-day activities.