$1.5 billion for manufacturers affected by tariffs

As for the other major program announced by the federal government, it will invest $500 million in the Regional Tariff Response Initiative, which aims to support Canadian businesses affected by U.S. tariffs, regardless of their sector. “These funds will enable SMEs to cope with the impact of tariffs and access the financing needed to make strategic shifts, improve their productivity, and diversify their markets,” explained Evan Solomon, the minister responsible for the Federal Economic Development Agency for Southern Ontario, during the press conference.

“We are in the midst of a trade war. We are on the front lines, and our goal is to protect workers and ensure the survival of businesses,” said Ms. Joly. “Our aim is to ensure that companies retain their workforce and that we can help them pivot, which is no small feat.” The minister also reported that Ottawa is currently in talks with the lumber and forestry sector regarding additional financial support.

“We know that the tariffs affecting this sector are not the same as those on steel, aluminum, and copper,” she said. “But at the same time, we’re looking at how the BDC can offer the same type of support.”

This announcement follows Washington’s decision on April 6 to modify U.S. tariffs on metals. Since then, the U.S. government has been applying a 25% surcharge on the total value of products containing at least 15% steel, aluminum, or copper. This is equivalent to a comprehensive tariff, reports Radio-Canada. This change replaces the previous system, which applied a 50% rate but only to the metal component.

This new method therefore drastically broadens the tax base, with tariffs now applying to the full customs value of aluminum, steel, and copper products and their derivatives, regardless of their metal content. Primary metals, however, remain subject to a 50% surcharge under the new tax system.

This new tariff system has significantly complicated the calculation of tariff rates, causing confusion among customs brokers and small Canadian businesses, La Presse reports.

Dominique O’Rourke, MP for Guelph—one of the regions most affected by the tariffs—agrees. She stated at the press conference that the main factor affecting businesses in Ontario’s manufacturing belt is uncertainty.

“This new interpretation of Section 232 tariffs has had significant consequences, as the situation for companies that were exporting based on a certain assumption changed overnight,” the representative said.

“It is extremely difficult for companies to keep up with changes in customs duties.” In addition to Ms. O’Rourke, other Liberal members of the Legislative Assembly from ridings hard-hit by customs duties attended the press conference, including Lisa Hepfner of Hamilton Mountain and Marilyn Gladu of Sarnia—Lambton—Bkejwanong.

While the Canada–United States–Mexico Agreement (USMCA) used to protect the majority of Canadian exports, that is no longer the case today. At a press conference, Minister Joly was unable to specify the number of companies affected.

The announcement comes two weeks after Canadian Prime Minister Mark Carney accused Washington of violating the free trade agreement. “Tariffs of 50% on steel, 50% on aluminum, 25% on automobiles, and all tariffs on forest products: these are not mere inconveniences; they are violations of our trade agreement,” he lamented.

The USMCA is set to be reviewed by July 1. However, the United States is demanding a “price of admission” from Canada to resume dialogue as part of this review.