Section 338 Tariffs on Canadian Goods – A New Approach to Tariffs

On July 20, 2026, President Trump issued three significant trade proclamations under Section 338 of the Tariff Act of 1930, as amended (the Act). These proclamations impose a 50% ad valorem tariff on select Canadian motor vehicles, alcoholic beverages, and dairy products. The administration issued these measures in response to what it has identified as discriminatory, unequal, and unreasonable trade policies maintained by Canada that disproportionately burden American commerce. The tariffs are set to take effect at 12:01 a.m. Eastern Time on August 19, 2026, providing a standard 30-day notice period mandated under federal law before implementation. Notably, these are the first actions taken under section 338 in decades, with the last considered use in 1949. These actions also demonstrate that the Trump administration is willing to use a broad array of trade measures to pursue fair trade and that tariffs remain an essential favored economic tool.