At a glance
- Recommended action
- Review classifications, shipment timing, sourcing exposure, and cumulative duties before the effective dates.
- Effective date
- September 15 and September 29, 2026
- What changed
- The United States revised Section 338 tariff coverage and announced import bans on selected Canadian products.
- Who is affected
- Importers of affected Canadian-origin dairy, alcoholic beverage, motor vehicle, and newly listed products.
- Business impact
- Affected goods may face revised 50% duties, import bans, or cumulative Section 232 and Section 338 exposure.
Recommended actions
What importers should do next
- Review affected tariff classifications and country of origin.
- Identify products added to or removed from the U.S. Section 338 scope effective October 30.
- Quantify potential tariff and landed-cost exposure.
- Evaluate potential overlapping duty exposure, including applicable Section 232 duties on U.S. imports.
- Confirm appropriate customs reporting and documentation.
- Evaluate available duty-relief and recovery opportunities, where applicable.
- Review sourcing, pricing, and contractual tariff provisions.
Current Update: U.S.–Canada Tariff Measures Expand
Effective Dates: October 30, 2026
Recent U.S. and Canadian trade actions are creating additional tariff exposure for companies operating across the U.S.–Canada border.
United States – Section 338 Tariffs on Canadian Goods
On October 23, 2026, the President issued a proclamation further modifying the scope of Canadian products subject to the additional 50% ad valorem duties imposed under Section 338 of the Tariff Act of 1930.
The revised scope applies to covered goods entered for consumption, or withdrawn from warehouse for consumption, on or after 12:01 a.m. Eastern Time on October 30, 2026. Certain products are removed from the additional duties, while others are newly added.
Products removed include certain:
Plywood sheets Paper and paperboard products Machinery and refrigeration equipment Packing boxes, crates, and similar products
Products added include certain:
Cocoa powder Paints and related products Soaps and personal-care products Vinyl flooring Carpets and other floor coverings Wood and paper products Chest freezers Valves Canoes Instruments Waste products
Importers should review the specific HTSUS classifications in the October 23 Annex to determine whether their products of Canada have been added to or removed from the Section 338 tariff scope.
Important Clarification – USMCA and Section 232
For Canadian products covered by the Section 338 measures, the additional 50% tariff applies regardless of whether the goods qualify as originating under the United States-Mexico-Canada Agreement (USMCA).
Additionally, the Section 338 duties apply in addition to applicable duties imposed under Section 232.
Accordingly, USMCA eligibility alone does not exempt an otherwise covered product from Section 338, and importers should evaluate potential Section 338 and Section 232 exposure independently.
Canada – Retaliatory Surtaxes on U.S. Goods
Separately, effective September 8, 2026, Canada imposed retaliatory surtaxes on specified U.S.-origin goods in response to U.S. Section 338 and Section 232 tariff measures.
Depending on the applicable tariff classification, covered goods are subject to an additional 15%, 25%, or 50% surtax.
For purposes of Canada's surtax, U.S.-origin goods are those eligible to be marked as goods of the United States under Canada's Determination of Country of Origin for the Purpose of Marking Goods (CUSMA Countries) Regulations.
Key Business Considerations
Canada to United States
Certain Canadian goods may be subject to the additional 50% Section 338 tariff. USMCA qualification does not, by itself, exempt goods covered by the Section 338 measures. Applicable Section 338 and Section 232 duties may apply to the same merchandise.
United States to Canada
Specified U.S.-origin goods may be subject to Canadian surtaxes of 15%, 25%, or 50%, depending on the applicable classification. Classification and origin are critical in determining whether the Canadian surtax applies.
Legal Challenge
A legal challenge to the U.S. Section 338 tariffs on Canadian imports has been filed with the U.S. Court of International Trade. Companies should continue monitoring developments while complying with the currently applicable tariff requirements.
How Crane Trade Consulting Can Help
Crane Worldwide Logistics can assist customers in evaluating the potential customs and trade-compliance implications of the new guidance and reviewing available products, sourcing, and import information to help determine how the guidance may apply to their transactions. For additional consultation on a case-by-case basis, please contact https://www.craneww.com/logistics-technology/tarfiff-response-unit/.
Disclaimer
This advisory is provided for informational purposes only and does not constitute legal advice. The information is based on publicly available government sources, including the President Proclamation, issued on October 23, 2026. Trade regulations, filing requirements, duty payment procedures, and administrative processes may be modified, clarified, or supplemented through subsequent Federal Register notices, CBP guidance, or other government actions. Importers should consult qualified legal counsel and trade compliance professionals before making decisions based on evolving customs compliance requirements.
Previous Update:
On September 8, 2026, President Trump signed five proclamations under Section 338 of the Tariff Act of 1930 that expand trade restrictions on certain Canadian-origin products and modify measures previously announced on July 20, 2026.
According to the White House, these actions were taken in response to what the Administration describes as Canada's continued discriminatory treatment of U.S. commerce, including approximately $20 billion in retaliatory tariffs imposed on U.S. exports following the suspension of bilateral trade discussions.
The new measures include:
- Changes to the list of Canadian products subject to an additional 50% Section 338 duty.
- Removal of certain products, including rock salt and cement, from the tariff scope.
- Addition of new products to the tariff scope, including certain all-terrain vehicles (ATVs) and additional dairy products.
- Import bans on specified Canadian alcoholic beverages, dairy products, and motor vehicles.
- Continued application of Section 338 duties regardless of USMCA eligibility.
- Continued application of Section 338 duties in addition to applicable Section 232 duties.
In addition to the trade measures, the President directed the U.S. Trade Representative (USTR) and the General Services Administration (GSA) to remove Canadian-origin products from the GSA Multiple Award Schedules program, which administers more than $50 billion in annual federal procurement activity.
- Revised product lists for the 50% Section 338 duties become effective.
- Certain products will be added to, and removed from, the scope of the existing tariffs.
- Corresponding HTSUS modifications take effect.
- Import bans on designated Canadian alcoholic beverages become effective. • Import bans on designated Canadian dairy products become effective. • Import bans on designated Canadian motor vehicles become effective.
Effective September 29, 2026, specified Canadian-origin products identified in the respective proclamations will be prohibited from importation into the United States.
The import bans affect selected:
- Alcoholic beverages
- Dairy products
- Motor vehicles
Products imported into the United States prior to September 29, 2026, but not yet entered for consumption or withdrawn from warehouse for consumption, will remain subject to the applicable 50% Section 338 duties rather than the import prohibition.
The motor vehicle Import ban specifically identifies the following HTSUS classification:
8711.50.00 – Motorcycles (including mopeds) and cycles fitted with a reciprocating internal-combustion piston engine with a cylinder capacity exceeding 800 cc
Crane Worldwide Logistics recommends that importers:
- Review product classifications against the revised tariff and import-ban annexes.
- Identify products that have been added to or removed from the Section 338 tariff scope.
- Evaluate supply chain exposure to affected Canadian-origin goods.
- Consider shipment timing and inventory planning prior to the September 15 and September 29 effective dates.
- Assess cumulative duty exposure where both Section 338 and Section 232 duties may apply.
- Coordinate with customs brokers and trade compliance teams to ensure proper entry processing and duty payment.
Crane Trade Consulting is actively monitoring these developments and is available to assist with can assist importers with HTS classification reviews, Duty impact assessments, Supply chain risk evaluations, Import planning strategies, and Customs compliance guidance. For additional consultation on a case-by-case basis, please contact our Trade Advisory team.
Products Added to or Removed from the 50% Tariff Scope:
Need help assessing the new Section 338 measures?
Crane Trade Consulting can support classification reviews, duty-impact assessments, supply chain risk evaluation, import planning, and customs compliance.