The United States decided to reverse its plan to impose additional 25% tariffs on Canadian steel and aluminum after the province of Ontario canceled the rates it planned to impose on electricity exports to three U.S. states. This measure was announced following President Trump's threat to impose a 50% tariff on Canada.
White House spokesman Kush Desai reported that Ontario Premier Doug Ford contacted Secretary of Commerce Howard Lutnick to announce the reversal of the 25% tariff on electricity exports to the United States.
Previously, Trump had announced on social media the imposition of an additional 25% tariff on steel and aluminum from Canada, thus raising the total tariff to 50% in response to the planned tariffs by Ontario on the export of Canadian electricity.
For its part, Ontario agreed to suspend the 25% tariff on electricity exports to the three U.S. states. Ontario Premier Doug Ford will travel to Washington to meet with the Secretary of Commerce and discuss the renewal of the USMCA before the April 2 deadline for reciprocal tariffs.
It is worth mentioning that Trump initially imposed a general 25% tariff against Canada and Mexico in early March and eliminated tariff-free quotas, exemptions, and exclusions on steel and aluminum. However, he later adjusted the measures to exempt goods that met the USMCA's preferential conditions until April 2.
The Canadian government had previously announced a 25% tariff on U.S. goods, while the province of Ontario had applied a 25% tax on electricity exports to three U.S. states in response to the general tariffs against Canadian goods.
Under Trump's executive orders, a 25% tariff on steel and aluminum "without exceptions or exemptions" is expected to take effect for all trade partners starting March 12. In addition, President Trump signed proclamations to increase aluminum tariffs from 10% to 25% starting February 10.