US President Donald Trump signed three proclamations imposing an additional 50% ad valorem duty on selected Canadian goods, including beer, wine, spirits, dairy ingredients, hops, and numerous consumer and industrial products. The measures are scheduled to take effect at 12:01 a.m. ET on August 19, 2026. According to US Trade Representative Jamieson Greer, the affected products account for nearly USD 20 billion in annual Canadian imports.
The administration invoked Section 338 of the Tariff Act of 1930, a rarely used authority allowing the president to impose additional duties of up to 50% on goods from countries deemed to discriminate against US commerce. The three actions address separate disputes involving Canadian restrictions on American alcoholic beverages, the administration of cheese import quotas, and tariffs and quotas affecting US motor vehicles.
Preferential treatment under the United States-Mexico-Canada Agreement (USMCA, known as CUSMA in Canada) will not exempt the listed products from the additional duty. Covered Canadian goods will therefore face the 50% tariff even when they otherwise qualify for duty-free treatment under the trade agreement.
The alcohol proclamation responds to decisions by Canadian provincial and territorial liquor authorities to halt purchases, distribution, and retail sales of American alcoholic beverages beginning in March 2025 (inside.beer, 3.2.205; inside.beer, 6.3.2025). Alberta and Saskatchewan subsequently lifted their restrictions in June 2025, while bans remained in place in most other provinces and territories. According to the White House, the value of American alcoholic beverages imported into Canada fell by approximately 81%, from around USD 718 million during the previous twelve-month period to approximately USD 137 million between March 2025 and February 2026.
The affected alcohol categories include Canadian beer made from malt, wine, cider, sake, whisky, brandy, rum, gin, vodka, liqueurs, and other fermented or distilled beverages. The annex to the alcohol proclamation also includes several unrelated products, such as certain wooden articles, paper goods, essential oils, and ice-hockey equipment.
The dairy proclamation is based on differences between the eligibility rules governing Canada’s cheese tariff-rate quotas under the USMCA and those established under the Comprehensive Economic and Trade Agreement (CETA) with the European Union. However, cheese itself is not included in the operative US tariff list. Instead, the additional duties apply to products including concentrated milk and cream, dried whey, milk protein concentrates, lactose, casein, and milk albumin.
The dairy-related annex also contains two products of particular relevance to the brewing industry: non-alcoholic beer and ground, powdered, or pelletized hop cones. Whole hop cones and hop extracts appear in the annex attached to the motor-vehicle proclamation, meaning that important Canadian brewing raw materials will also be subject to the additional 50% duty.
Although the third proclamation formally responds to Canadian measures affecting US motor vehicles, its tariff annex primarily covers several hundred non-automotive goods. These include cement, furniture, textiles, electrical equipment, household products, sporting goods, artworks, hops, and hop extracts. Across all three proclamations, more than 550 tariff subheadings are affected in total.
The White House excluded energy products, potash, goods already subject to US Section 232 tariffs, certain fish and critical minerals, and qualifying civil-aircraft products from the additional duties. The precise exclusions vary between the individual proclamations and their implementing annexes.
Trade tensions between the neighboring countries have escalated since early 2025. Chris Swonger, CEO of the Distilled Spirits Council of the United States, said American spirits producers had already suffered almost a year and a half of collateral damage from the dispute. While welcoming the administration’s recognition of the problem, he warned that imposing a 50% tariff on Canadian spirits could deepen tensions, provoke further retaliation, and cause additional harm to producers on both sides of the border. He called for a negotiated solution restoring duty-free trade in spirits.
Canadian Prime Minister Mark Carney described the tariffs as another unilateral US trade action and said they directly violated the CUSMA. His government stated that it was examining the economic impact and possible responses while remaining prepared to intensify negotiations with Washington.
