Half of Americans are against Canadian tariffs, preferring to keep CUSMA intact, survey finds
By Anam Khan
BNNBloomberg.ca
American views of Canada and CUSMA
There has been a great sense of betrayal among Canadians during Trump’s second term in office following the imposition of sweeping tariffs and his repeated public suggestions that Canada should be annexed as the 51st state, the survey finds.
And while some Canadians might be angry, three-quarters of Americans still have a “friendly” view of Canada.
This is despite the counter actions taken by the Canadian government in response to U.S. tariffs, which includes Canadians avoiding U.S. travel and removing American liquor off shelves, both of which were called ‘nasty’ by the American ambassador to Canada.
Canada’s favorability rating in the U.S. is currently higher than that of any other major American allies, with the United Kingdom at 68 per cent favourable and the European Union at 60 per cent, the poll found.
American perception of Trump’s tariffs
While U.S. inflation has cooled under Trump, his administration’s tariffs had an inflationary effect on retail prices last year, with the New York Federal Reserve President claiming that the tariffs have kept inflation under the U.S. Federal Reserve’s two per cent goal, the survey finds.
Meanwhile, two thirds of Americans believe that tariffs are mostly paid by American consumers and businesses, while the rest believe the cost is passed to foreign companies or spread among domestic consumers, businesses and foreign companies and governments.
More than half of Americans disapprove of Trump’s tariff policies (57 per cent), nearly double the rate of approval (30 per cent).
Top issues for Americans
According to the survey, nearly half of Americans are most concerned about the cost of living, while roughly one-third prioritize government corruption and healthcare costs.
Political leanings appear to influence what issues Americans prioritize, but the high cost of living ranks high across the board.
While MAGA supporters focus on the border and crime, other Republicans have a different take on healthcare. Meanwhile, Democrats are more concerned with the fallout from U.S. Immigration and Customs Enforcement (ICE) crackdowns than their Republican counterparts.
METHODOLOGY
The Angus Reid Institute conducted an online survey from March 2 5, 2026 among a representative randomized sample of 1,529 American adults who are members of Angus Reid Forum USA. For comparison purposes only, a probability sample of this size would carry a margin of error of +/- 3 percentage points, 19 times out of 20. Discrepancies in or between totals are due to rounding. The survey was self-commissioned and paid for by ARI.
Anam Khan
Journalist, BNNBloomberg.ca
By Anam Khan
BNNBloomberg.ca
Picture of the Canadian flag taken in Ottawa. Ottawa is the capital city of Canada, and a major hub for economy, politics and business in America.
Most Americans do not want to cut Canada out of the Canada-U.S.-Mexico Agreement (CUSMA), according to new data released Wednesday from the Angus Reid Institute.
A new survey finds that twice as many Americans want to keep the trade deal as those who want to end it. Three quarters of Americans have a favourable view of Canada, with more than half of the population describing it as “the most important” or a “very important” trading partner to the U.S.
The poll found about 51 per cent of the American population would not even tariff Canadian goods if they had it their way.
Furthermore, Trump’s MAGA Republican base is more likely to want tariffs, but about half say they prefer splitting Mexico and Canada and negotiating separate deals, than not.
Most Americans do not want to cut Canada out of the Canada-U.S.-Mexico Agreement (CUSMA), according to new data released Wednesday from the Angus Reid Institute.
A new survey finds that twice as many Americans want to keep the trade deal as those who want to end it. Three quarters of Americans have a favourable view of Canada, with more than half of the population describing it as “the most important” or a “very important” trading partner to the U.S.
The poll found about 51 per cent of the American population would not even tariff Canadian goods if they had it their way.
Furthermore, Trump’s MAGA Republican base is more likely to want tariffs, but about half say they prefer splitting Mexico and Canada and negotiating separate deals, than not.
American views of Canada and CUSMA
There has been a great sense of betrayal among Canadians during Trump’s second term in office following the imposition of sweeping tariffs and his repeated public suggestions that Canada should be annexed as the 51st state, the survey finds.
And while some Canadians might be angry, three-quarters of Americans still have a “friendly” view of Canada.
This is despite the counter actions taken by the Canadian government in response to U.S. tariffs, which includes Canadians avoiding U.S. travel and removing American liquor off shelves, both of which were called ‘nasty’ by the American ambassador to Canada.
Canada’s favorability rating in the U.S. is currently higher than that of any other major American allies, with the United Kingdom at 68 per cent favourable and the European Union at 60 per cent, the poll found.
American perception of Trump’s tariffs
While U.S. inflation has cooled under Trump, his administration’s tariffs had an inflationary effect on retail prices last year, with the New York Federal Reserve President claiming that the tariffs have kept inflation under the U.S. Federal Reserve’s two per cent goal, the survey finds.
Meanwhile, two thirds of Americans believe that tariffs are mostly paid by American consumers and businesses, while the rest believe the cost is passed to foreign companies or spread among domestic consumers, businesses and foreign companies and governments.
More than half of Americans disapprove of Trump’s tariff policies (57 per cent), nearly double the rate of approval (30 per cent).
Top issues for Americans
According to the survey, nearly half of Americans are most concerned about the cost of living, while roughly one-third prioritize government corruption and healthcare costs.
Political leanings appear to influence what issues Americans prioritize, but the high cost of living ranks high across the board.
While MAGA supporters focus on the border and crime, other Republicans have a different take on healthcare. Meanwhile, Democrats are more concerned with the fallout from U.S. Immigration and Customs Enforcement (ICE) crackdowns than their Republican counterparts.
METHODOLOGY
The Angus Reid Institute conducted an online survey from March 2 5, 2026 among a representative randomized sample of 1,529 American adults who are members of Angus Reid Forum USA. For comparison purposes only, a probability sample of this size would carry a margin of error of +/- 3 percentage points, 19 times out of 20. Discrepancies in or between totals are due to rounding. The survey was self-commissioned and paid for by ARI.
Anam Khan
Journalist, BNNBloomberg.ca
March 11, 2026
Price shocks from Iran war could give Canada leverage in CUSMA talks: experts
ByThe Canadian Press
March 13, 2026
WASHINGTON — Countries around the world are grappling with skyrocketing costs for key commodities like oil and fertilizer as the war with Iran continues to upend global trade.
With no end in sight, the war is likely to cast a shadow over trade negotiations ahead of the mandatory review of the Canada-U.S.-Mexico Agreement on trade — and could ultimately offer Canada more leverage in those talks.
“If you’re sitting in Washington and you’re seeing what’s happening to global markets, you’re going to be looking at your secure producers and suppliers perhaps slightly differently from the way you … might’ve been looking at them before the conflict began, which was solely in tariff terms,” said Fen Osler Hampson, a professor of international affairs at Carleton University in Ottawa and co-chair of the Expert Group on Canada-U.S. Relations.
Crude oil and natural gas prices shot up after Iran essentially closed the Strait of Hormuz in response to the United States-Israel bombing campaign.
A fifth of the world’s oil typically sails through the strait.
But oil and gas are not the only commodities being affected.
Fertilizer inputs and potash are also being held up, causing global prices to spike with just weeks to go until planting season.
American farmers are already feeling the brunt of U.S. President Donald Trump’s erratic foreign and trade policies. The Trump administration provided a financial bailout last year after farmers were pummeled by increased costs and dropping sales due to the president’s worldwide tariffs.
Aluminum prices also jumped after the Iran war began, sending shock waves through American industries already staring down Trump’s separate 50 per cent tariffs on the product.
Canada is an alternative supplier for many of those key commodities. Trump has claimed repeatedly that the United States doesn’t need anything from Canada; the war in the Middle East might suggest otherwise.
“Suddenly, your closer partners, with whom you might have had a slightly antagonistic relationship … it may be time to play nice because they have things that (Trump) wants in abundance,” Hampson said.
The relationship between Canada and the United States has been upended by Trump’s tariffs and his repeated calls for Canada’s annexation. Trump called Prime Minister Mark Carney a “governor” in a social media post earlier this week.
Canadian and Mexican officials have been preparing for tough negotiations on the continental trade pact known as CUSMA, which has been shielding both countries from the worst effects of Trump’s tariffs.
Trump has put into question his commitment to CUSMA, which was negotiated during his first administration. The president has called the deal “irrelevant” and has said it may have served its purpose.
The CUSMA review sets up a three-way choice for each country to make in July. They can renew the deal for another 16 years, withdraw from it or signal both non-renewal and non-withdrawal — which would trigger an annual review that could keep negotiations going for up to a decade.
Trump did have a lot of leverage going into the CUSMA review. His ever-changing tariff policy kept Canada and Mexico on edge and slowed investment as businesses in both countries searched for stability.
The Trump administration also has other tools to pressure the United States’ closest neighbours.
The Department of Justice recently launched an antitrust investigation into fertilizer producers — including Saskatchewan’s Nutrien — around collusion and price-fixing, Bloomberg reported last week.
The government of Saskatchewan is aware of the investigation, the province’s Ministry of Energy and Resources said in a media statement.
“Fertilizers are globally traded commodities in a highly competitive environment,” the statement said. “Pricing is determined by the market, not the producing companies.”
While it’s not clear if that investigation is directly linked to CUSMA negotiations, potash is certainly on the Trump administration’s mind as the Iran war continues.
Luke Lindberg, the undersecretary for trade and foreign agricultural affairs at the U.S. Department of Agriculture, told Politico recently that “any company or any part of the fertilizer supply chain who tries to use this opportunity to price-gouge American farmers and ranchers will not be tolerated, and I think that is the message that will be clearly delivered.”
The Iran conflict and the price shocks it has triggered should remind Washington that the United States depends on other nations when it sits down to talk about the future of CUSMA, said Inu Manak, senior fellow for international trade at the Council on Foreign Relations.
“We need to have trusted partners if we’re going to actually address some of these challenges and survive these shocks,” Manak said.
As a major commodity producer, Canada is essential to the U.S. industrial base, she added, pointing to potash, oil and the integrated market.
“I think in a way, the mindset going into the negotiations now is potentially shifting a bit and giving Canada space to sort of focus on those issues and to say, ‘Look, we want to work with you. We have been working with you for a very long time. Here are the things that maybe we can do to strengthen those bonds rather than to weaken them,’” she said.
Manak said Canada may also have gained leverage from the deep unpopularity of the Iran war among Americans — who are preparing to go to the polls for midterm elections in November.
That doesn’t mean Trump’s threats will stop, she added.
“Buckle up for a lot of uncertainty.”
This report by The Canadian Press was first published March 13, 2026.
— With files from Jeremy Simes in Regina and The Associated Press
Kelly Geraldine Malone, The Canadian Press
ByThe Canadian Press
March 13, 2026
WASHINGTON — Countries around the world are grappling with skyrocketing costs for key commodities like oil and fertilizer as the war with Iran continues to upend global trade.
With no end in sight, the war is likely to cast a shadow over trade negotiations ahead of the mandatory review of the Canada-U.S.-Mexico Agreement on trade — and could ultimately offer Canada more leverage in those talks.
“If you’re sitting in Washington and you’re seeing what’s happening to global markets, you’re going to be looking at your secure producers and suppliers perhaps slightly differently from the way you … might’ve been looking at them before the conflict began, which was solely in tariff terms,” said Fen Osler Hampson, a professor of international affairs at Carleton University in Ottawa and co-chair of the Expert Group on Canada-U.S. Relations.
Crude oil and natural gas prices shot up after Iran essentially closed the Strait of Hormuz in response to the United States-Israel bombing campaign.
A fifth of the world’s oil typically sails through the strait.
But oil and gas are not the only commodities being affected.
Fertilizer inputs and potash are also being held up, causing global prices to spike with just weeks to go until planting season.
American farmers are already feeling the brunt of U.S. President Donald Trump’s erratic foreign and trade policies. The Trump administration provided a financial bailout last year after farmers were pummeled by increased costs and dropping sales due to the president’s worldwide tariffs.
Aluminum prices also jumped after the Iran war began, sending shock waves through American industries already staring down Trump’s separate 50 per cent tariffs on the product.
Canada is an alternative supplier for many of those key commodities. Trump has claimed repeatedly that the United States doesn’t need anything from Canada; the war in the Middle East might suggest otherwise.
“Suddenly, your closer partners, with whom you might have had a slightly antagonistic relationship … it may be time to play nice because they have things that (Trump) wants in abundance,” Hampson said.
The relationship between Canada and the United States has been upended by Trump’s tariffs and his repeated calls for Canada’s annexation. Trump called Prime Minister Mark Carney a “governor” in a social media post earlier this week.
Canadian and Mexican officials have been preparing for tough negotiations on the continental trade pact known as CUSMA, which has been shielding both countries from the worst effects of Trump’s tariffs.
Trump has put into question his commitment to CUSMA, which was negotiated during his first administration. The president has called the deal “irrelevant” and has said it may have served its purpose.
The CUSMA review sets up a three-way choice for each country to make in July. They can renew the deal for another 16 years, withdraw from it or signal both non-renewal and non-withdrawal — which would trigger an annual review that could keep negotiations going for up to a decade.
Trump did have a lot of leverage going into the CUSMA review. His ever-changing tariff policy kept Canada and Mexico on edge and slowed investment as businesses in both countries searched for stability.
The Trump administration also has other tools to pressure the United States’ closest neighbours.
The Department of Justice recently launched an antitrust investigation into fertilizer producers — including Saskatchewan’s Nutrien — around collusion and price-fixing, Bloomberg reported last week.
The government of Saskatchewan is aware of the investigation, the province’s Ministry of Energy and Resources said in a media statement.
“Fertilizers are globally traded commodities in a highly competitive environment,” the statement said. “Pricing is determined by the market, not the producing companies.”
While it’s not clear if that investigation is directly linked to CUSMA negotiations, potash is certainly on the Trump administration’s mind as the Iran war continues.
Luke Lindberg, the undersecretary for trade and foreign agricultural affairs at the U.S. Department of Agriculture, told Politico recently that “any company or any part of the fertilizer supply chain who tries to use this opportunity to price-gouge American farmers and ranchers will not be tolerated, and I think that is the message that will be clearly delivered.”
The Iran conflict and the price shocks it has triggered should remind Washington that the United States depends on other nations when it sits down to talk about the future of CUSMA, said Inu Manak, senior fellow for international trade at the Council on Foreign Relations.
“We need to have trusted partners if we’re going to actually address some of these challenges and survive these shocks,” Manak said.
As a major commodity producer, Canada is essential to the U.S. industrial base, she added, pointing to potash, oil and the integrated market.
“I think in a way, the mindset going into the negotiations now is potentially shifting a bit and giving Canada space to sort of focus on those issues and to say, ‘Look, we want to work with you. We have been working with you for a very long time. Here are the things that maybe we can do to strengthen those bonds rather than to weaken them,’” she said.
Manak said Canada may also have gained leverage from the deep unpopularity of the Iran war among Americans — who are preparing to go to the polls for midterm elections in November.
That doesn’t mean Trump’s threats will stop, she added.
“Buckle up for a lot of uncertainty.”
This report by The Canadian Press was first published March 13, 2026.
— With files from Jeremy Simes in Regina and The Associated Press
Kelly Geraldine Malone, The Canadian Press
March 13, 2026
WASHINGTON -- The Trump administration has expanded its trade investigations to 60 countries, including Canada, in an effort to shore up the president’s tariff policies.
“We are trying to move very quickly,” United States Trade Representative Jamieson Greer told CNBC Friday. “We are trying to move in a matter of months.”
Greer’s office announced Wednesday that it was launching investigations of excess industrial capacity in the European Union and a handful of other countries under Section 301 of the Trade Act of 1974.
A Thursday evening news release from the office expanded the list of countries targeted by the investigations, citing forced labour.
“Despite the international consensus against forced labor, governments have failed to impose and effectively enforce measures banning goods produced with forced labor from entering their markets,” Greer said in the news release.
“For too long, American workers and firms have been forced to compete against foreign producers who may have an artificial cost advantage gained from the scourge of forced labor.”
Canada is aware of the latest trade investigation, said Canada-U.S. Trade Minister Dominic LeBlanc’s spokesperson.
“We are committed to working with our (Canada-U.S.-Mexico Agreement) partners to further a North American approach to tackling forced labour in international supply chains, as we have done over the last number of years,” Gabriel Brunet said in an email.
The new investigations are meant to give President Donald Trump a legal basis to continue his worldwide tariff agenda.
Last month, the U.S. Supreme Court struck down Trump’s favourite tariff tool, which he used for his “Liberation Day” tariffs and fentanyl-related duties on Canada, Mexico and China.
In response to the top court’s ruling, Trump implemented a 10 per cent worldwide tariff using Section 122 of the 1974 Trade Act. Those tariffs do not apply to goods compliant with the Canada-U.S.-Mexico Agreement on trade.
Section 122 tariffs can only increase to 15 per cent and expire after 150 days unless Congress votes to extend them. An extension would be unlikely to get the approval of Congress.
Canada is also being hammered by Trump’s separate Section 232 tariffs on specific industries, including steel, aluminum, automobiles and cabinetry.
Trump is hoping to implement longer-term tariffs through Section 301 investigations but the process does require public consultations and reports.
Greer told CNBC that “if we find that countries have been involved in unfair trading practices” — such as subsidies, excess capacity or forced labour — “we can quantify that harm to U.S. commerce and then try to resolve that issue with that country.”
If the country doesn’t resolve the issue, Greer said, the Trump administration will impose tariffs.
It’s not immediately clear what the 301 investigation of Canada could cover, or if it will look beyond the justification of “forced labour.”
The Federal Register notice published by the trade representative’s office about the investigation says that “Canada, Mexico, and the European Union have adopted measures intended to stop the importation or sale of products produced using forced labor.”
Canada already has legislation intended to curb forced labour in supply chains, which requires annual reports to the federal government. Canada has rules forbidding forced labour in supply chains and free trade agreements.
There are other long-standing irritants in the Canada-United States trading relationship and Trump has complained repeatedly about Canada’s dairy supply management system.
The 301 investigations are launching as Canada, Mexico and the U.S. prepare for a mandatory review of the Canada-U.S.-Mexico Agreement on trade, better known as CUSMA.
Trump has cast doubt on his commitment to the trade pact, which was negotiated during his first term. He has called it “irrelevant” and has said it may have served its purpose.
The U.S. has officially launched negotiations on the CUSMA review with Mexico, which is also subject to a 301 investigation. Ottawa and Washington have not announced a similar move.
While Greer has claimed often that Canada has barriers that make it difficult to negotiate — he has cited provincial bans on sales of U.S. alcohol — he met with Canada’s new trade team in Washington last week.
Canada’s chief trade negotiator Janice Charette and newly appointed Ambassador to the United States Mark Wiseman were joined by Canada-U.S. Trade Minister Dominic LeBlanc in the meeting.
This report by The Canadian Press was first published March 13, 2026.
Kelly Geraldine Malone, The Canadian Press
WASHINGTON -- The Trump administration has expanded its trade investigations to 60 countries, including Canada, in an effort to shore up the president’s tariff policies.
“We are trying to move very quickly,” United States Trade Representative Jamieson Greer told CNBC Friday. “We are trying to move in a matter of months.”
Greer’s office announced Wednesday that it was launching investigations of excess industrial capacity in the European Union and a handful of other countries under Section 301 of the Trade Act of 1974.
A Thursday evening news release from the office expanded the list of countries targeted by the investigations, citing forced labour.
“Despite the international consensus against forced labor, governments have failed to impose and effectively enforce measures banning goods produced with forced labor from entering their markets,” Greer said in the news release.
“For too long, American workers and firms have been forced to compete against foreign producers who may have an artificial cost advantage gained from the scourge of forced labor.”
Canada is aware of the latest trade investigation, said Canada-U.S. Trade Minister Dominic LeBlanc’s spokesperson.
“We are committed to working with our (Canada-U.S.-Mexico Agreement) partners to further a North American approach to tackling forced labour in international supply chains, as we have done over the last number of years,” Gabriel Brunet said in an email.
The new investigations are meant to give President Donald Trump a legal basis to continue his worldwide tariff agenda.
Last month, the U.S. Supreme Court struck down Trump’s favourite tariff tool, which he used for his “Liberation Day” tariffs and fentanyl-related duties on Canada, Mexico and China.
In response to the top court’s ruling, Trump implemented a 10 per cent worldwide tariff using Section 122 of the 1974 Trade Act. Those tariffs do not apply to goods compliant with the Canada-U.S.-Mexico Agreement on trade.
Section 122 tariffs can only increase to 15 per cent and expire after 150 days unless Congress votes to extend them. An extension would be unlikely to get the approval of Congress.
Canada is also being hammered by Trump’s separate Section 232 tariffs on specific industries, including steel, aluminum, automobiles and cabinetry.
Trump is hoping to implement longer-term tariffs through Section 301 investigations but the process does require public consultations and reports.
Greer told CNBC that “if we find that countries have been involved in unfair trading practices” — such as subsidies, excess capacity or forced labour — “we can quantify that harm to U.S. commerce and then try to resolve that issue with that country.”
If the country doesn’t resolve the issue, Greer said, the Trump administration will impose tariffs.
It’s not immediately clear what the 301 investigation of Canada could cover, or if it will look beyond the justification of “forced labour.”
The Federal Register notice published by the trade representative’s office about the investigation says that “Canada, Mexico, and the European Union have adopted measures intended to stop the importation or sale of products produced using forced labor.”
Canada already has legislation intended to curb forced labour in supply chains, which requires annual reports to the federal government. Canada has rules forbidding forced labour in supply chains and free trade agreements.
There are other long-standing irritants in the Canada-United States trading relationship and Trump has complained repeatedly about Canada’s dairy supply management system.
The 301 investigations are launching as Canada, Mexico and the U.S. prepare for a mandatory review of the Canada-U.S.-Mexico Agreement on trade, better known as CUSMA.
Trump has cast doubt on his commitment to the trade pact, which was negotiated during his first term. He has called it “irrelevant” and has said it may have served its purpose.
The U.S. has officially launched negotiations on the CUSMA review with Mexico, which is also subject to a 301 investigation. Ottawa and Washington have not announced a similar move.
While Greer has claimed often that Canada has barriers that make it difficult to negotiate — he has cited provincial bans on sales of U.S. alcohol — he met with Canada’s new trade team in Washington last week.
Canada’s chief trade negotiator Janice Charette and newly appointed Ambassador to the United States Mark Wiseman were joined by Canada-U.S. Trade Minister Dominic LeBlanc in the meeting.
This report by The Canadian Press was first published March 13, 2026.
Kelly Geraldine Malone, The Canadian Press
Trump seeks to close US$1.6 trillion revenue gap with raft of new tariffs
By The Associated Press
March 14, 2026
By The Associated Press
March 14, 2026
Containers are piled up at a cargo terminal in Frankfurt, Germany, Monday, March 9, 2026. (AP Photo/Michael Probst)
WASHINGTON — The Trump administration this week stepped up its ambitious effort to replace about US$1.6 trillion in lost tariff revenue that was eliminated by the U.S. Supreme Court’s decision to strike down a range of the president’s import taxes.
Recovering that lost revenue, which the White House was counting on to help offset the steep, multi-trillion dollar cost of its tax cuts, is possible but will be challenging, experts say. The administration has to use different legal provisions to impose new duties, and those provisions require longer, complex processes that U.S. companies can use to seek exemptions. It could be months or more before it is clear how much revenue the replacement tariffs will yield.
“I wouldn’t bet against this administration being able to get back on paper the same effective tariff rate they had before,” said Elena Patel, co-director of the Urban-Brookings Tax Policy Center. But the new approach will “make it easier for people to contest the tariffs, which is going to put a big asterisk on the revenue until all that is settled.”
On Wednesday, U.S. Trade Representative Jamieson Greer said the administration will investigate 16 economies — including the European Union — over whether their governments are subsidizing excessive factory capacity in a way that disadvantages U.S. manufacturing. The investigation will also cover China, South Korea, and Japan, Greer said.
In addition, he said there would be a second investigation of dozens of countries to see if their failure to ban goods made by forced labor amounts to an unfair trade practice that harms the United States. That investigation will also cover the EU and China, as well as Mexico, Canada, Australia, and Brazil.
Both investigations are being conducted under Section 301 of the 1974 Trade Act, which requires the administration to consult with the targeted countries, as well as hold public hearings and allow affected U.S. industries to comment. A hearing as part of the factory capacity investigation will be held May 5, while a hearing on the forced labor investigation will occur April 28.
It’s a far cry from the emergency law that President Donald Trump relied on in his first year in office, which allowed him to immediately impose tariffs on any country, at nearly any level, simply by issuing an executive order.
Moments after the Supreme Court’s ruling, Trump imposed a 10 per cent tariff on all imports under a separate legal authority, but that duty can only last for 150 days. The president has said he would raise it to 15 per cent, the maximum allowed, but has yet to do so. Some two dozen states have already challenged the new tariffs. The administration is aiming to complete its Section 301 investigations before the 10 per cent duties expire.
The effort underscores the importance that the Trump White House has placed on tariffs as a revenue-raiser at a time when the federal government is facing huge annual budget deficits for decades into the future. Previous administrations, by contrast, used tariffs more sparingly to narrowly protect specific industries.
Erica York, vice president of federal tax policy at the Tax Foundation, noted that the first investigation covers roughly 70 per cent of imports, while the second would cover nearly all of them.
“That breadth suggests the goal isn’t to address the issues at hand, but instead to recreate a sweeping tariff tool,” she said.
Trump sees tariffs as a way to force foreign countries to essentially help pay the cost of U.S. government services, even though all recent economic studies find that American companies and consumers are paying the duties, including ones from the Federal Reserve Bank of New York and economists at Harvard University. In his state of the union address last month, Trump even touted his tariffs as a potential replacement for the income tax, which would return the United States’ tax regime to the late 19th century.
Trump also wants tariffs to help pay for the tax cuts he extended in key legislation last year. The tax cut legislation is expected, according to the most recent estimates by the nonpartisan Congressional Budget Office, to add $4.7 trillion to the national debt over a decade, while all Trump’s duties, including ones not struck down by the court, were projected to offset about $3 trillion — or two-thirds of that cost.
The court’s ruling Feb. 20 that he could no longer impose emergency tariffs eliminated about $1.6 trillion in expected revenue over the next decade, according to the CBO.
Some of Trump’s tariffs remain place, including previous duties on China and Canada that were imposed after earlier 301 investigations. The administration has also slapped tariffs on some specific products, including steel, lumber, and cars. Those, combined with the 10 per cent tariff for part of this year, should yield about $668 billion over the next decade, the Tax Foundation estimates.
“It’s going to take a really big patchwork of these other investigations to make up for the (lost) tariffs,” York said.
The administration’s efforts are also unusual because they reflect an overreliance on tariffs to bring in more government revenue. Trump has also said the duties are intended to return manufacturing to the United States, and he has used them to leverage trade deals.
“What makes this really different,” said Kent Smetters, executive director of the Penn Wharton Budget Model, “it is really the first time tariffs have been mainly used as a revenue raiser.”
Patel, meanwhile, argues that raising revenue can be done more reliably and straightforwardly by Congress. Laws like Section 301 are traditionally intended to be used to address specific trade policy concerns in particular countries.
“It’s not supposed to be there to raise revenue,” she said. “If we want to raise revenue through tariffs, then Congress should impose a broad based tariff.”
Christopher Rugaber, The Associated Press
WASHINGTON — The Trump administration this week stepped up its ambitious effort to replace about US$1.6 trillion in lost tariff revenue that was eliminated by the U.S. Supreme Court’s decision to strike down a range of the president’s import taxes.
Recovering that lost revenue, which the White House was counting on to help offset the steep, multi-trillion dollar cost of its tax cuts, is possible but will be challenging, experts say. The administration has to use different legal provisions to impose new duties, and those provisions require longer, complex processes that U.S. companies can use to seek exemptions. It could be months or more before it is clear how much revenue the replacement tariffs will yield.
“I wouldn’t bet against this administration being able to get back on paper the same effective tariff rate they had before,” said Elena Patel, co-director of the Urban-Brookings Tax Policy Center. But the new approach will “make it easier for people to contest the tariffs, which is going to put a big asterisk on the revenue until all that is settled.”
On Wednesday, U.S. Trade Representative Jamieson Greer said the administration will investigate 16 economies — including the European Union — over whether their governments are subsidizing excessive factory capacity in a way that disadvantages U.S. manufacturing. The investigation will also cover China, South Korea, and Japan, Greer said.
In addition, he said there would be a second investigation of dozens of countries to see if their failure to ban goods made by forced labor amounts to an unfair trade practice that harms the United States. That investigation will also cover the EU and China, as well as Mexico, Canada, Australia, and Brazil.
Both investigations are being conducted under Section 301 of the 1974 Trade Act, which requires the administration to consult with the targeted countries, as well as hold public hearings and allow affected U.S. industries to comment. A hearing as part of the factory capacity investigation will be held May 5, while a hearing on the forced labor investigation will occur April 28.
It’s a far cry from the emergency law that President Donald Trump relied on in his first year in office, which allowed him to immediately impose tariffs on any country, at nearly any level, simply by issuing an executive order.
Moments after the Supreme Court’s ruling, Trump imposed a 10 per cent tariff on all imports under a separate legal authority, but that duty can only last for 150 days. The president has said he would raise it to 15 per cent, the maximum allowed, but has yet to do so. Some two dozen states have already challenged the new tariffs. The administration is aiming to complete its Section 301 investigations before the 10 per cent duties expire.
The effort underscores the importance that the Trump White House has placed on tariffs as a revenue-raiser at a time when the federal government is facing huge annual budget deficits for decades into the future. Previous administrations, by contrast, used tariffs more sparingly to narrowly protect specific industries.
Erica York, vice president of federal tax policy at the Tax Foundation, noted that the first investigation covers roughly 70 per cent of imports, while the second would cover nearly all of them.
“That breadth suggests the goal isn’t to address the issues at hand, but instead to recreate a sweeping tariff tool,” she said.
Trump sees tariffs as a way to force foreign countries to essentially help pay the cost of U.S. government services, even though all recent economic studies find that American companies and consumers are paying the duties, including ones from the Federal Reserve Bank of New York and economists at Harvard University. In his state of the union address last month, Trump even touted his tariffs as a potential replacement for the income tax, which would return the United States’ tax regime to the late 19th century.
Trump also wants tariffs to help pay for the tax cuts he extended in key legislation last year. The tax cut legislation is expected, according to the most recent estimates by the nonpartisan Congressional Budget Office, to add $4.7 trillion to the national debt over a decade, while all Trump’s duties, including ones not struck down by the court, were projected to offset about $3 trillion — or two-thirds of that cost.
The court’s ruling Feb. 20 that he could no longer impose emergency tariffs eliminated about $1.6 trillion in expected revenue over the next decade, according to the CBO.
Some of Trump’s tariffs remain place, including previous duties on China and Canada that were imposed after earlier 301 investigations. The administration has also slapped tariffs on some specific products, including steel, lumber, and cars. Those, combined with the 10 per cent tariff for part of this year, should yield about $668 billion over the next decade, the Tax Foundation estimates.
“It’s going to take a really big patchwork of these other investigations to make up for the (lost) tariffs,” York said.
The administration’s efforts are also unusual because they reflect an overreliance on tariffs to bring in more government revenue. Trump has also said the duties are intended to return manufacturing to the United States, and he has used them to leverage trade deals.
“What makes this really different,” said Kent Smetters, executive director of the Penn Wharton Budget Model, “it is really the first time tariffs have been mainly used as a revenue raiser.”
Patel, meanwhile, argues that raising revenue can be done more reliably and straightforwardly by Congress. Laws like Section 301 are traditionally intended to be used to address specific trade policy concerns in particular countries.
“It’s not supposed to be there to raise revenue,” she said. “If we want to raise revenue through tariffs, then Congress should impose a broad based tariff.”
Christopher Rugaber, The Associated Press
No comments:
Post a Comment