Trump’s global tariffs were struck down. Don’t expect price drops: experts

Economists have pointed out that the impact of the IEEPA tariffs on Canada has been blunted by the exemptions granted to goods traded in compliance with CUSMA.

While U.S. President Donald Trump’s sweeping global tariffs were struck down by the U.S. Supreme Court on Friday, experts and economists say the decision is unlikely to bring relief for consumers in Canada.

Hours after the court’s decision on his tariffs, Trump said he was imposing another global tariff of 10 per cent under Section 122 of the U.S. Trade Act, which limits tariffs that address trade deficits to 15 per cent and for no longer than 150 days.

The law Trump used to impose the global tariffs that were struck down — the International Emergency Economic Powers Act (IEPPA) — “does not authorize the President to impose tariffs,” Chief Justice John Roberts wrote in the majority opinion.

Economists have pointed out that the impact of the IEEPA tariffs on Canada has been blunted by the exemptions granted to goods traded in compliance with the Canada-U.S.-Mexico Free Trade Agreement (CUSMA).

According to a report by RBC, around 89 per cent of Canadian exports to the U.S. in December were not charged with tariffs because they’re compliant with rules of origin requirements in CUSMA.

“The ruling will have less impact on Canadian trade than most other countries. Most Canadian exports are already exempt from IEEPA tariffs via an exemption for CUSMA compliant trade,” the RBC report said.

While nearly 90 per cent of the tariffs’ economic burden was borne by U.S. consumers and firms, Canadians have felt the impact of higher prices because of the integrated supply chains between the two countries.

For example, beer cans use Canadian aluminum and are made into can sheets in the United States. The metal crosses the border several times before it hits the shelves.