United States announces tariffs on Canada, Mexico, and China; 30-day postponement for Canada and Mexico

In response to concerns related to drug trafficking and illegal immigration

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February 3, 2025

The Trump Administration on February 1, 2025, issued three executive orders imposing tariffs on Canadian, Mexican and Chinese products imported into the United States on or after February 4, 2025, in response to concerns related to drug trafficking and illegal immigration.

The White House on February 1, 2025, also released a fact sheet explaining that the concerns addressed above constitute a national emergency under the International Emergency Economic Powers Act (IEEPA). 

However, according to reports, following discussions between U.S. President Trump with President Sheinbaum of Mexico and Prime Minister Trudeau of Canada, tariffs on imports from Mexico and Canada have been postponed for a period of 30 days due to agreements by both Mexico and Canada to supply personnel to the borders. The postponements were then officially announced in these executive orders:

Canada: The initial executive order—based on concerns about Canada's role in drug trafficking and fentanyl production—would impose a 25% tariff on Canadian products except Canadian energy resources, which would be subject to a lower 10% tariff.

Mexico: The initial executive order—in response to issues related to drug trafficking and illegal immigration, and alleged connections with drug cartels—would impose a 25% tariff on Mexican products.

China: The executive order—addressing China's export of precursor chemicals used in opioid production and its alleged support for transnational criminal organizations—would impose a 10% additional tariff on Chinese products. A CBP notice released today modifies the HTSUS with respect to certain Chinese products imported on or after February 4, 2025.

For more information, contact a professional with KPMG Trade & Customs services:

Andrew Siciliano
Partner, U.S. & Global Practice Leader

E: asiciliano@kpmg.com

Doug Zuvich
Partner

E: dzuvich@kpmg.com

Irina Vaysfeld
Principal

E: ivaysfeld@kpmg.com

John L. McLoughlin
Principal

E: jlmcloughlin@kpmg.com

Luis (Lou) Abad
Principal

E: labad@kpmg.com

George Zaharatos
Principal

E: gzaharatos@kpmg.com

Christopher Young
Principal

E: christopheryoung@kpmg.com

Amie Ahanchian
Principal

E: aahanchian@kpmg.com

Gisele Belotto
Principal

E: gbelotto@kpmg.com

Steve Brotherton
Principal

E: sbrotherton@kpmg.com

Jessica Libby
Principal

E: jlibby@kpmg.com

Dawn Olesky
Principal

E: dolesky@pmg.com

Frances Xing
Principal

E: francesxing@kpmg.com

 

 

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