Section 338 duties on Canadian goods reach $21.5 billion of U.S. imports

Since 12:01 a.m. eastern time on Aug. 22, 2026, products of Canada on three lists in chapter 99 of the tariff schedule have paid an additional 50% duty under section 338 of the Tariff Act of 1930. The lists cover 1,431 ten-digit tariff lines, which carried $21.5 billion of U.S. imports from Canada in the 12 months to July 2026.

That is 5.6% of the $385.3 billion the United States imported from Canada over the same months, and those goods paid an average duty of 2.48%. Every trade figure here predates the duty: Census data run through July 2026. The action has changed twice: new product lists took effect on Sept. 15, and on Sept. 29 part of the listed trade moved from the 50% duty to an import ban.

Four sets of proclamations since July

Section 338 lets the President "impose duties on imports of a foreign country to offset the burden or disadvantage from a foreign country's discrimination against or unequal imposition on the commerce of the United States," in the words of Proclamation 11046. Three proclamations signed July 20 each make one such finding: provincial bans on "the purchase, distribution, or retailing of U.S. alcoholic beverages"; Canada's "TRQ allocation measures imposed on U.S. cheeses of all types under the USMCA" (TRQ: tariff-rate quota); and "a tariff system on only U.S. motor vehicles." Each imposes "an additional ad valorem duty of 50 percent" on "certain products of Canada, as set forth in Annex II," so the titles name the Canadian practice each action answers, not the goods taxed. As first issued, the duties did not apply to goods subject to Section 232 duties or to civil aircraft.

Proclamation 11056, citing the status of negotiations with Canada, reset the date: "The effective date of the additional ad valorem duties imposed in Proclamations 11046, 11047, and 11048 shall be 12:01 a.m. eastern time on August 22, 2026." It was published two days after that date. The September proclamations record that on Aug. 22 "the 3-day suspension imposed by Proclamation 11056 lapsed, and the additional ad valorem duties" became effective. The duties sit in 9903.03.12 (alcohol list), 9903.03.13 (dairy list) and 9903.03.14 (motor-vehicle list); 9903.03.15 and 9903.03.16 hold the carve-outs.

Where the $21.5 billion sits

The motor-vehicle list is the widest, with 513 provisions, and holds 94% of the trade. Its largest lines from Canada are boards and panels for electric control (8537.10.91.70, $696 million), silver jewelry ($645 million), plastic articles ($641 million), data-network equipment ($613 million) and seat parts for motor vehicles ($604 million). It barely touches cars: of the $23.2 billion of passenger vehicles (HS 8703) imported from Canada, $6 million is in the two listed provisions, golf carts and spark-ignition cars with engines of 1,000 cc or less.

The alcohol list's largest line is chemically modified fats and oils (1518.00.40, $326 million), ahead of liqueurs ($294 million) and whiskies ($96 million) in containers of 4 liters or less. The dairy list is mostly milk powders, whey, casein and sugars.

Sept. 15: new lists, stacked on Section 232

Proclamations 11064 and 11065 rewrote two of the lists from Sept. 15. The alcohol list gained cheeses, modified fats, raw hides, furskins and motorboats, lines that carried $391 million of imports from Canada in the 12 months to July, and lost whiskies and liqueurs in containers over 4 liters ($61 million). The motor-vehicle list gained steel structures, aluminum profiles and tubes, graphic paper, base-metal fittings, welding electrodes, furniture, mattresses, lamps, golf carts and small cars ($1.4 billion), and lost switchgear for up to 1,000 volts, Portland cement, salt, refined lead and tissue stock, among others ($1.7 billion).

The same proclamations ended the Section 232 carve-out for those two lists. "The duties imposed pursuant to Proclamation 11046, as modified in this proclamation, shall apply in addition to duties imposed pursuant to section 232 of the Trade Expansion Act of 1962," Proclamation 11064 reads, and Proclamation 11065 says the same of Proclamation 11048. U.S. note 51(c), the carve-out in the schedule, now names only the dairy heading, 9903.03.13. For aluminum alloy profiles from Canada, the import.tax lookup shows 50% under 9903.03.14 plus 50% under the Section 232 heading 9903.82.02: 100% on top of the ordinary rate.

Sept. 29: from a duty to a ban

Proclamations 11061, 11062 and 11063 find that Canada "maintained" the practices after the duties took effect (the alcohol proclamation says "maintained or increased") and turn part of each list into a ban: "certain alcoholic beverages that are products of Canada, as set forth in the Annex to this proclamation, are excluded from importation into the United States, effective with respect to goods imported on or after 12:01 a.m. eastern time on September 29, 2026." The other two use the same words for "certain products of Canada." Goods imported before then but not yet entered "will remain subject to the 50 percent duty rate."

The annexes, printed as images in the Federal Register and as text on whitehouse.gov, list:

• alcoholic beverages: beer, wine, cider, vermouth, undenatured ethyl alcohol for beverages, whisky, rum, gin, vodka, liqueurs, brandy, tequila and mezcal, many bulk lines only when in "packaged boxes, kegs, or other similar direct-to-consumption containers";
• under the dairy action: whey, molasses and invert molasses, and nonalcoholic beer;
• under the motor-vehicle action: one line, motorcycles with engines over 800 cc (8711.50.00).

Those lines carried $691 million, $45 million and $89 million of imports from Canada in the 12 months to July, $825 million in all; the alcohol figure is an upper bound, since packaged-only lines are counted in full. The schedule does not show the bans. HTS Revision 20, current since Sept. 28, has no entry for them, and the lookup for whiskies in containers of 4 liters or less still reads 50% under 9903.03.12, plus 10% under 9903.05.29 for goods that do not qualify under the USMCA; whey protein concentrates read 50% under 9903.03.13 on the same terms. If a ban is invalidated, each proclamation says, the 50% duty applies to those goods instead.

Spirits from Canada were falling before the duties began: $103 million in May–July 2026, 47% below the $192 million of the same months of 2025. The data do not show why.

What to watch

• Oct. 6: the Census Bureau releases August 2026 trade data, the first month to include the duty, from Aug. 22.
• The dairy list: Proclamation 11062 refers to a Sept. 8 proclamation modifying the scope of the dairy duties. None had been published in the Federal Register by Sept. 29, and the schedule still prints the dairy list and its Section 232 carve-out unchanged.
• The schedule: no HTS revision carrying the Sept. 29 bans had been published by Sept. 29; the proclamations leave further schedule changes to U.S. Customs and Border Protection, by notice in the Federal Register. All tariff changes are listed as they appear.