Trump Pauses 50% Canada Tariffs for Three Days as U.S. Trade Deal Takes Shape

U.S. President Donald Trump has delayed new 50% tariffs on Canadian goods for three days after announcing that the United States and Canada had reached a preliminary trade agreement.

The tariffs were scheduled to take effect at midnight and would have covered roughly $20 billion in Canadian imports. Trump said on Truth Social that the pause was granted because the two countries have a deal, subject to finalizing documentation.

Canadian Prime Minister Mark Carney offered a more cautious assessment, saying “substantial progress” had been achieved while acknowledging that important issues remain unresolved. Trump and Carney spoke Tuesday afternoon as officials continued weeks of intensive trade negotiations.

U.S. Trade Representative Jamieson Greer’s office said the emerging U.S.-Canada trade deal includes expanded market access for American products, economic security commitments and digital trade provisions.

A White House proclamation said Canada had committed to addressing U.S. concerns involving duties on dairy products, alcoholic beverages and motor vehicles. However, Canadian officials have not confirmed specific terms of the agreement.

Automotive tariffs have been a major obstacle. Negotiators have discussed reducing U.S. Section 232 tariffs on Canadian vehicles from 25% to 15%, with additional reductions potentially linked to the amount of U.S.-made content in each vehicle.

The two countries have also disagreed over how North American content should be calculated for tariff deductions. Washington has pushed to count only U.S.-produced components, while Canada has sought recognition for Canadian and Mexican parts as well.

The Commerce Department separately introduced rules requiring automakers exporting from Canada and Mexico to certify U.S. content annually rather than twice yearly. Manufacturers must re-certify American content by September 30 to qualify for deductions beginning December 1.

Trump also suggested the canceled Keystone XL pipeline could potentially be revived, although he provided no details.

Canadian industries including lumber, dairy and wine had faced potential job losses and business closures if the 50% tariffs took effect. The temporary tariff pause now gives Washington and Ottawa additional time to finalize an agreement and prevent another escalation in U.S.-Canada trade tensions.