Canada’s next round of retaliatory tariffs on the United States takes effect just after midnight on September 8, and the finalized list — 874 U.S. tariff items worth roughly $27.6 billion, covering steel, dairy, appliances, agricultural equipment, pulp and paper, and electronics — has drawn heavy coverage this week for what it will cost Canadian consumers and importers. What most of that coverage has left out is what happened the last time Ottawa ran this play.
The tariffs set to take effect Tuesday will match U.S. Section 232 and Section 338 duties dollar-for-dollar, rate-for-rate, with individual product rates set at 15, 25 or 50 per cent depending on the American tariff they’re answering. Goods already in transit on September 8 are exempt, according to the Department of Finance list published in late August. Dairy products including cheese, household appliances, and certain steel and aluminum derivative products fall into the 25 per cent band.
Canada has run a version of this playbook before. When the U.S. imposed steel and aluminum tariffs in 2018, they hit roughly $16.6 billion of Canadian exports, and Canadian steel exports to the U.S. fell by 38 per cent as mills and downstream manufacturers absorbed the shock. Ottawa responded with matching retaliatory tariffs on U.S. goods, much as it’s doing now.
The results, according to research published by Statistics Canada and cited in subsequent economic analysis, were lopsided. The tariff fight is estimated to have produced roughly 1,000 new jobs in Canadian steel production — but cost approximately 75,000 jobs across manufacturers further down the supply chain who relied on steel or aluminum as an input. In other words, protecting the metal producers came at a much larger cost to the factories that turn that metal into finished goods.
There was an upside for the firms that stayed in the export game: Statistics Canada found that steel and aluminum producers who kept exporting to the U.S. through the tariff period increased their investment by about 60 per cent, using the disruption to retool and diversify. The tariffs were lifted in May 2019, timed to the ratification of the new USMCA trade agreement, after roughly a year in place.
The economic backdrop has also shifted since the tariff fight began. Canada’s Q2 2026 GDP figures were revised sharply upward, showing the economy grew at an annualized rate of about 3.3 per cent — the fastest pace since 2023 — and the accompanying Q1 revision means the “technical recession” that dominated headlines earlier this year didn’t actually happen. That doesn’t erase the risk in the new tariff round, but it does mean Ottawa is entering this fight from firmer economic footing than the narrative of a struggling economy might suggest.
Whether the same lopsided trade-off — a small number of jobs protected in targeted sectors against a much larger number lost downstream — repeats this time will depend on how long the current tariffs stay in place and how directly they hit manufacturers that depend on the newly tariffed inputs. The 2018-19 experience suggests that’s the number worth watching over the coming months, more than the headline dollar figure attached to the tariff list itself.
