The trade relationship between the United States and Canada is entering a new phase, and businesses involved in cross-border trade should pay close attention.

Following the expiration of a temporary suspension, U.S. Customs and Border Protection (CBP) reinstated 50% Section 338 duties on certain Canadian-origin products effective August 22, 2026, under CSMS #69606660. The additional duties apply to products classified under HTSUS headings 9903.03.12, 9903.03.13, and 9903.03.14, potentially increasing costs for a wide range of importers.

While certain products remain exempt, including select steel, aluminum, copper, vehicle-related products, semiconductors, patented pharmaceuticals, and civil aircraft articles, many businesses may now face higher landed costs, increased compliance requirements, and greater pressure on their supply chain strategies.

Canada Responds with Retaliatory Tariffs

Adding another layer of complexity, the Canadian government has announced a series of "dollar-for-dollar" retaliatory tariffs that will take effect on September 8, 2026.

These measures target numerous U.S. industries, including:

• Steel and aluminum
• Dairy products
• Household appliances
• Agricultural equipment
• Pulp and paper
• Plastics
• Electronics

In several categories, tariff rates will increase from 25% to 50%, matching the measures imposed by the United States.

Why This Matters for Your Business

As trade tensions continue to evolve, businesses on both sides of the border could experience:

• Increased import and procurement costs
• Greater customs compliance risks
• Supply chain disruptions and sourcing challenges
• Changes to pricing and profitability
• Additional scrutiny of HTS classifications

Now more than ever, accurate product classification and proactive trade planning are essential to avoid unexpected costs and maintain compliance.

Review Your Exposure Before Costs Increase

Understanding how these changes affect your products is critical. Companies should take this opportunity to review their tariff exposure, validate HTS classifications, and evaluate sourcing strategies to minimize operational and financial impacts.

Our Customs Brokerage team has compiled the complete list of impacted HTS codes, along with insights to help businesses navigate these new trade measures with confidence.

Download the Full HTS Code List

Access the complete list of impacted products and discover how these tariff changes could affect your business operations.

Section 338 Canada HTS LIST Final

Now is the time to take a proactive approach to compliance, supply chain planning, and cost management in an increasingly complex trade environment.

Sources

• CBP CSMS #69606660 – Guidance: Section 338 Additional Duties on Certain Goods of Canada
• Government of Canada – Counter-Tariffs Effective September 8, 2026
• Federal Register Presidential Proclamations 11046, 11047, 11048, and 11056 (as referenced by CBP)