Economist warns Canada’s retaliatory tariffs will act as a self-imposed tax
Professor Trevor Tombe says the new U.S. duties on Canadian goods and Canada’s planned retaliation will function like a tax, burdening Canadian consumers and firms.
The United States has recently raised tariffs on a range of Canadian products, and Canada has confirmed that it will impose its own retaliatory duties beginning on September 8. Trevor Tombe, who teaches economics at the University of Calgary and directs fiscal policy at its School of Public Policy, argues that tariffs essentially act as a tax on the importing country’s own economy. Consequently, Canadian households and companies will shoulder much of the expense of Ottawa’s response, just as they already bear the impact of the American tariffs.
Tombe discusses potential tax-policy adjustments the Carney administration could adopt to lessen the blow and simultaneously boost competitiveness and productivity. The analysis underscores the broader economic fallout of the escalating trade dispute between the two neighbours.
Why it matters
The tariffs will raise prices for Canadians and could slow economic growth, affecting everyday consumers and businesses.
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