Ontario Premier Doug Ford announced that he would suspend the province’s 25% tariff on U.S.-bound electricity following a meeting with U.S. Commerce Secretary Howard Lutnick. This decision comes after President Donald Trump threatened to double tariffs on Canada. Ford initially stood firm on the surtax, but changed course after scheduling a meeting with U.S. officials.
Trump’s proposed tariffs, in response to Ontario’s tariffs on electricity exports, could significantly impact the auto industry in Canada. The tariffs are part of an ongoing trade dispute between the two countries. Despite Trump’s promises that tariffs would benefit Americans, they are typically paid by importers, who may then pass on the cost to consumers.
Trump recently granted temporary relief to Canada and Mexico, exempting goods under the United States-Mexico-Canada Agreement from tariffs. However, he plans to announce broader reciprocal tariffs against countries imposing tariffs on U.S. goods in the future.
Ontario’s decision to suspend the electricity tariff is seen as an attempt to engage in constructive dialogue with the U.S. and avert further economic consequences.
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