US-Canada tariff war escalates as new 50% duties threaten to push up car and toilet paper prices

Canadian Prime Minister Mark Carney has responded with retaliatory tariffs on a broad range of American products after Trump threatened to lift duties on Canadian vehicles from 25% to 50% starting 1 January 2027. Oxford Economics lead economist Bernard Yaros warns the car-price cushion that dealers have absorbed so far is "wearing thin" and that higher costs will now feed through to consumers more readily. The row, which erupted when trade talks collapsed last weekend, is putting pressure on goods in both countries — from cars to construction materials to household staples.

Trump's 50% tariffs on Canadian goods could reportedly push toilet-paper maker fibre costs up by 11% and paper-towel costs by as much as 31%, according to North Carolina State University professor Ronalds Gonzalez.

Canada has matched the US rate of 50% on steel and aluminium and added fresh import taxes on American wood products including plywood and even screws, deepening the supply-chain squeeze.

Critics argue Trump has broken his 2024 pledge to cut prices — pointing out his own administration quietly exempted electronics and foodstuffs from earlier tariffs to avoid political backlash.