Tax Insight

US revises Section 338 tariffs on Canadian goods and imposes targeted import bans

Insight
5 minute read
September 11, 2026

What happened?

President Trump on September 8 issued five proclamations under Section 338 of the Tariff Act of 1930 that impose import bans on certain Canadian products and modify the scope of previously imposed 50% tariffs on other Canadian products. The actions follow the Administration’s position that Canada maintained or increased discriminatory treatment of US commerce with respect to alcoholic beverages, dairy products, and motor vehicles. The import bans take effect September 29, while modifications to the products subject to the 50% tariffs take effect September 15.

Why is it relevant?

The actions represent a significant escalation in US trade measures against Canada, shifting certain products from a 50% additional tariff to an import ban, effective September 29. The Section 338 tariffs apply to covered goods regardless of whether they qualify as originating under the United States-Mexico-Canada Agreement (USMCA) and, where applicable, in addition to Section 232 tariffs. Companies importing Canadian products therefore may face increased tariff exposure or, where products are subject to the new import bans, the need to identify alternative sources of supply.

Actions to consider

Companies with Canadian supply chains should identify products potentially affected by the September 15 tariff modifications and September 29 import bans, assess goods currently in transit or in bonded inventory, and evaluate alternative sourcing and supply-chain arrangements where necessary. Companies also may wish to model the impact of overlapping tariffs and review implications related to contractual arrangements, customs valuation, and transfer pricing. Finally, impacted companies should monitor forthcoming US Customs and Border Protection (CBP) guidance and Federal Register notices implementing the measures.

For more details, please read the full Tax Insight linked below.