Trump Tariffs Update: Canada Trade War, New Import Taxes, and Refunds

Tariffs have been central to President Donald Trump's economic strategy, with frequent announcements and revisions since the start of his second term.

He has argued that these taxes on imported goods and services are crucial for reducing the United States' trade deficit and enhancing U.S. manufacturing.

But Trump’s tariff policy has entered a new phase following a landmark United States Supreme Court ruling that struck down many of his broadest import taxes.

From just $107.88 $24.99 for Kiplinger Personal Finance

Become a smarter, better informed investor. Subscribe from just $107.88 $24.99, plus get up to 4 Special Issues

CLICK FOR FREE ISSUE

Sign up for Kiplinger’s Free Newsletters

Profit and prosper with the best of expert advice on investing, taxes, retirement, personal finance and more - straight to your e-mail.

Profit and prosper with the best of expert advice - straight to your e-mail.

Sign up

While some tariffs have remained in place, others are being replaced, and U.S. Customs is working to issue billions in refunds.

Meanwhile, the administration has turned to other legal authorities to impose new tariffs, including a 50% tariff on certain Canadian goods. Canada has now responded with its own tariffs on U.S. products. Here’s where things stand.

Trump tariffs: What's happening

As of September 2026, the U.S. tariff landscape is no longer defined by a single sweeping policy. Instead, it has become a patchwork of active tariffs, invalidated measures, and potential replacements: new tariffs imposed under other trade authorities following the Supreme Court’s February 20, 2026 ruling.

That 6-3 decision found that the Trump administration overstepped its authority by using the International Emergency Economic Powers Act (IEEPA) to impose broad, across-the-board tariffs on imports.

Those "reciprocal tariffs," first rolled out in April 2025, had applied to dozens of countries and hundreds of categories of goods.

While the ruling immediately disrupted that framework, it didn't eliminate tariffs. The Trump administration has since used other authorities, including Sections 301 and 338, to impose new duties, while federal agencies figure out how to process potentially tens of billions in tariff refunds.

Which tariffs were blocked by the Supreme Court

The Supreme Court decision primarily affects the broad global tariffs introduced in April 2025, often referred to as the “Liberation Day” tariffs.

As a result:

• Sweeping “reciprocal tariffs” applied to most countries are no longer enforceable.
• Tariffs calculated using trade deficits as justification have been invalidated.
• Federal agencies had to review those tariffs and determine how to implement the Court's decision.

What tariffs are still in effect?

Despite the Supreme Court striking down broad IEEPA duties, several major tariffs remain active, generally because they rely on different legal authorities.

And...in late July 2026, President Trump moved to re-impose and expand tariffs using alternative legal authorities.

• After temporary surcharges expired, the Trump administration announced new 10% and 12.5% duties under Section 301 of the Trade Act of 1974, targeting 60 economies over their treatment of forced-labor imports.
• At the same time, the White House escalated specific trade disputes, invoking Section 338 of the Tariff Act of 1930 for the first time in history to place 50% retaliatory tariffs on Canadian goods.
• Those Section 338 tariffs took effect Aug. 22 after a brief three-day suspension for negotiations. They cover $27.6 billion of Canadian goods, including products such as wine, dairy, furniture, clothing and sporting goods.
• Canada responded on September 8 by imposing 15%, 25% and 50% counter-tariffs on $27.6 billion of U.S. goods, matching the applicable U.S. Section 338 and Section 232 rates. The affected products include steel and aluminum, dairy, appliances, agricultural equipment, pulp and paper, plastics, and electronics.

Because the White House is regularly shifting its approach to keep duties active, we've broken down the current landscape by trade authority rather than individual country lists.

Note: Specific tariff rates and affected products may continue to change as the administration modifies its trade policies.

Canada-U.S. trade war escalates

The U.S.-Canada trade dispute is ongoing.

• U.S. Section 338 tariffs of 50% on $27.6 billion of Canadian goods took effect on August 22, 2026, following disputes over Canada’s treatment of U.S. alcoholic beverages, dairy products, and motor vehicles. The Trump administration has described the measures as a response to discriminatory or unequal treatment of U.S. commerce.
• Canada announced retaliatory counter-tariffs on August 25. Effective at 12:01 a.m. on September 8, Canada imposed 15%, 25%, and 50% duties on $27.6 billion of U.S.-origin imports, matching the U.S. action dollar for dollar and rate for rate.
• Affected goods include steel and aluminum, dairy products, appliances, agricultural equipment, pulp and paper, plastics, and electronics.

Existing Canadian counter-tariffs on U.S. autos remain in force.

The escalation adds uncertainty for companies dependent on tightly integrated U.S.-Canada supply chains and occurs during the USMCA’s scheduled joint review.

IEPPA tariff refunds: Who is getting money back?

One of the most significant operational tasks following the Supreme Court decision will be returning over $100 billion collected under the invalidated IEEPA tariffs.

Are tariff refunds actually happening? Generally, yes. Following orders from the U.S. Court of International Trade (CIT), U.S. Customs and Border Protection (CBP) established an official system — the Consolidated Administration and Processing of Entries (CAPE) platform — to return unlawfully collected duties.

CBP has been issuing payments on a rolling basis, but recovery depends on which phase an importer’s claim falls under:

• Phase 1 (Active since April 2026): Covers unliquidated entries and recent import entries. CBP has already disbursed billions of dollars back to Importers of Record for these claims.
• Phase 2 (Active since late June 2026): Handles claims flagged for complex customs reconciliation.
• Phase 3 (Launching as of late July 2026): Targets older, "finally liquidated" entries, which require more detailed documentation and administrative review.

Tariff refund eligibility generally depends on:

• Whether the tariffs were imposed under IEEPA authority
• Whether the importer of record filed a legal challenge or preserved a claim
• Documentation showing payment of tariffs tied to invalidated measures

That means not all businesses that paid tariffs will automatically receive money back. The federal government is issuing refunds on a rolling basis, but the total recovery effort remains a massive undertaking.

Given the volume of import claims, the payout process is expected to stretch well into the future as complex filings, batch reviews, and remaining court challenges play out.

Tariff economic Iimpact: prices, inflation, and uncertainty

Even with some tariffs struck down, the broader economic effects are still unfolding.

Higher prices: Tariffs function as taxes on imports, often leading to higher costs for goods like cars, appliances, and furniture

Inflation pressure: Some economists warn that tariffs contribute to broader price increases across the economy

Business uncertainty: Some companies delay hiring, investment, or expansion due to unclear trade policy

Mixed employment effects: Some domestic industries benefit from protection, while others that rely on imports face higher costs

Additionally, the inconsistent and historic nature of these tariff decisions has unsettled markets and caused confusion.

For example, on April 3 of last year, the U.S. stock market experienced its worst single-day decline since the pandemic during a sell-off following President Trump's tariff announcement. Wall Street sometimes uses the term "TACO trade" (Trump Always Chickens Out) to describe the on-and-off impacts of tariffs on the market.

Meanwhile, many economists, former allies, and even some in his own party have argued that Trump’s tariff policies harm the U.S. economy by increasing costs for businesses and consumers, exacerbating inflation, and potentially slowing economic growth.

For example, in a CBS interview, investor and philanthropist Warren Buffett described tariffs as "an act of war, to some degree."

Trump's former Vice President, Mike Pence, posted on X (formerly Twitter), stated that the tariffs were "the largest peacetime tax hike in U.S. history."

Last year, in a Fox Business interview, Sen. Ted Cruz (R-Texas) said, "I'm not a fan of tariffs," adding, "If the result is our trading partners jack up their tariffs and we have high tariffs everywhere, I think that is a bad outcome for America."

In an interview around that same time, Sen. Rand Paul of Kentucky said, "I believe that economically, it's a misconception to think that tariffs will benefit the nation."

Related

• What Are Tariffs and Who Pays?
• Supreme Court Strikes Down Many Trump Tariffs
• Which States Were Hardest Hit By Trump's Tariffs