Sep 10, 2026
This week, the tariff Canada charges on American steel and aluminum jumps from 25% to 50% — the sharpest escalation yet in a trade war that has been running since early 2025. At the same time, Ottawa is adding a new 25% tariff on U.S.-made household appliances and folding in dairy, furniture, clothing and dozens of other categories.
For a country where a lot of steel, aluminum and finished goods still cross the border in both directions, that sounds like an automatic price hike on the next fridge, dishwasher or vehicle a Canadian buys. The reality, according to the Bank of Canada’s own research on the earlier round of these tariffs, is messier — and less severe — than a straight pass-through of the tariff rate.
What’s actually changed on September 8
The new tariffs were confirmed on August 25, after trade talks with Washington collapsed and the U.S. imposed a 50% tariff on C$27.6 billion of Canadian exports. As a result, Canada is matching the U.S. tariffs dollar for dollar, rate for rate with its own list of roughly 700 tariff items, also worth C$27.6 billion in trade.
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For Canadian households, these new measures mean that starting on September 8, Canadians should anticipate two changes to goods from America:
- Canada’s existing counter-tariff on U.S. steel and aluminum — in place since 2025 at 25% — doubles to 50%
- A new 25% tariff applies to categories previously untouched, including household appliances and dairy products such as cheese
Canadians shopping for a new vehicle will not face additional counter-tariffs on U.S.-built vehicles; however, the counter-tariffs imposed in 2025 will remain at their existing rate of 25% on non-CUSMA-compliant vehicles and non-regional parts imported from the United States.
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What’s changed on September 8: Trump’s countermeasure
Within hours of Canada’s counter-tariffs taking effect on September 8, the Trump administration signed five proclamations retaliating further.
As a result, the U.S. is now banning imports of most Canadian alcohol and motorcycles, effective by the end of September, and adding Canadian mattresses and motorboats to the list of goods facing 50% U.S. tariffs.
Trump has also threatened to double tariffs on Canadian-built cars and auto parts to 50%, starting January 1 — a move that, if it goes ahead, would make vehicles a direct tariff target rather than an indirect one through steel and aluminum costs alone. For now, the auto counter-tariff remains unchanged at 25%, but that could shift again before year-end.
Impact of the steel and aluminum counter-tariff
The 50% counter-tariffs now imposed on the raw materials steel and aluminum will affect household budgets because those metals are embedded in houses, renovations, cars, appliances and countless manufactured goods.
As a result, this counter-tariff will look and feel more like a gradual cost increase rather than an overnight 50% jump in retail prices.
The most exposed household purchases are likely to include home renovations and construction, where steel goes into beams, roofing, fasteners, HVAC systems, ductwork, doors and other components.
Impact of the counter-tariff on households appliances
Canada was the largest export market for U.S. household appliances last year, buying more than US$1 billion worth of goods — most of which will now face the new 25% tariff, according to U.S. trade data cited by CNN Business. As a result, Canadian consumers may experience an immediate bump in prices for certain appliances and equipment, in addition to gradual pricing pressure as the counter-tariffs work through the system.
Why cars are affected indirectly, not directly
During this round of tariffs, there is no new, direct levy on U.S.-assembled vehicles imported into Canada — the existing auto counter-tariff stays at 25%.
But vehicles and auto repairs will still feel the impact of these new counter-tariffs because cars contain substantial amounts of steel and aluminum — and that exposure runs through the supply chain.
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Many vehicles sold in Canada, including those assembled at Ontario plants, use American steel and aluminum somewhere in their production. When that input cost doubles, automakers have to make choices: Absorb it, pass it along in sticker prices, or some mix of both.
Bank of Canada: What will actually happen to prices
To establish the impact of past and current tariffs, Bank of Canada researchers tracked daily prices at seven major Canadian retailers during the earlier round of counter-tariffs. The research found that prices on tariffed goods rose gradually, peaking at about 6% after three months — roughly one-quarter of the full 25% tariff rate being charged at the time. Untariffed substitute products saw little spillover, and when the counter-tariffs were later removed, the price increases reversed quickly.
For instance, on a refrigerator with a price tag of US$1,200, a full 25% tariff would add about C$300 to the price. But if the Bank of Canada research continues to hold true, the more realistic near-term increase for that fridge is closer to C$70, not C$300.
The BoC’s broader modelling also flagged that retaliatory tariffs feed into the consumer price index because roughly 13% of that basket is made up of goods imported from the U.S., so some upward pressure on inflation is expected — just not a one-for-one translation of the tariff rate.
What to do before you buy
None of this means prices won’t move at all, and retailers can choose to raise prices faster than the historical pattern suggests, particularly if they expect the tariffs to stick around. For anyone planning a big-ticket purchase in the next few months, a little diligence now can offset most of the risk.
To help, here are four strategies to use:
- Check country of origin before buying a major appliance — Canadian-made or third-country models sidestep the new 25% tariff entirely
- If you’re shopping for a vehicle assembled in Ontario, ask the dealer whether any price adjustment tied to steel and aluminum costs has already been applied, rather than assuming a future increase
- Watch for a “tariffed” label or note at checkout — Bank of Canada research found visible tariff labelling made retailers more willing to raise prices, so it’s also a signal of where the increase is real
- Don’t rush a purchase purely on tariff fear — the BoC’s data shows past price bumps were partial and reversed once the tariffs were lifted
Remember, Canada’s decision to double steel and aluminum tariffs, and to add a new levy on U.S. appliances, is a countermeasure — an effort to incentivize our trading partner to negotiate more favourable terms. While the real cost increase will begin to work through the supply chain starting September 8, there should be relatively few instances of massive price jumps at Canadian checkouts.
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Romana King, Senior Editor at Money.ca, also writes for various North American publications and the RKHomeowner blog. Her book, House Poor No More, is an Amazon bestseller and five-time award winner, including the 2022 New York CPA Society's Excellence in Financial Journalism (EFJ) Book Award.
