Canada is set to fire its biggest retaliatory shot yet in the escalating US-Canada trade war, with tariffs of up to 50% on hundreds of American products taking effect at 12:01 a.m. Tuesday, September 8.

The countermeasures, finalized by Prime Minister Mark Carney's government, will apply to roughly C$27.6 billion — about US$20 billion — worth of US goods, according to a notice from Canada's Department of Finance. Steel, aluminum, furniture and clothing face the steepest 50% duty; dairy products, appliances and seafood are taxed at 25%; and a wider basket of goods, including agricultural equipment, pulp and paper, and electronics, will see a 15% levy. Officials say the rate on each item was set to match, dollar for dollar, the US tariff on the equivalent Canadian product.

An Obscure Law, Revived

Canada's move mirrors the 50% duties Washington slapped on roughly $20 billion of Canadian wine, furniture, dairy and clothing effective August 22, after talks between the two governments broke down on August 18. Those US tariffs were imposed under Section 338 of the Tariff Act of 1930, a Depression-era authority that had sat dormant for nearly a century before the Trump administration revived it this summer, according to Fortune.

Canadian Finance Minister François-Philippe Champagne has framed the countermeasures, paired with a multibillion-dollar domestic support package, as necessary to shield Canadian industry. "It's all about fairness. It's all about a level playing field," Champagne said when the tariff list was first unveiled in late August, according to CNBC.

Washington isn't backing down either. Treasury Secretary Scott Bessent dismissed the retaliation in a Fox News appearance, predicting a "negligible" hit to US prices.

"This little yippy dog used to bark away and for a long time a 110-pound German shepherd was ignoring the Dachshund — and then one day she had enough," Bessent said of Canada, according to Yahoo Finance's report on the remarks.

The fight is landing squarely in swing-state territory. A Bloomberg report published Monday noted the Canadian tariffs will hit US exporters especially hard in Michigan and Ohio — both hosting competitive Senate races this November — while US Trade Representative Jamieson Greer has signaled Washington could respond with additional tariffs or outright import bans on Canadian goods.

Economists are already tallying the fallout: Oxford Economics estimates the combined rounds of tariffs will shave about 0.3% off Canadian output relative to prior forecasts. Domestically, though, Carney's hard line appears popular — a Nanos Research poll found close to three-quarters of Canadians rate his handling of the trade file as "good" or "very good."

With no new talks scheduled and both governments dug in, businesses on both sides of the border are bracing for the tariffs to bite starting Tuesday — and for the fight to keep escalating well into the fall.