For Canadian companies selling into the United States, the border has become less like a single tariff wall and more like a maze. Different products can now encounter U.S. duties imposed under Section 338 of the Tariff Act, Section 232 national-security rules, Section 301 trade enforcement and older anti-dumping laws, while low-value shipments have lost a once-important duty-free exemption.
The seven pressure points examined here do not mean one shipment automatically pays seven tariffs. U.S. rules contain exclusions and “unstacking” provisions, and the actual bill depends on tariff classification, origin, U.S. content and CUSMA eligibility. The broader problem is complexity: an exporter that cleared the border one way a year ago may now face a completely different calculation. Separate duties also exist in narrower sectors, making careful classification more important than ever.
Section 338 Has Created a New 50% Barrier Even for CUSMA Goods
The newest and most disruptive layer arrived on August 22, 2026, when the United States activated additional 50% duties under Section 338 of the Tariff Act of 1930. The measures were introduced through three actions tied by the U.S. administration to disputes over Canadian alcoholic beverages, dairy policies and motor vehicles. Their reach, however, extends beyond products that might immediately come to mind from those labels. Ottawa said the U.S. measures covered roughly C$27.6 billion worth of Canadian goods, making the action one of the largest new tariff shocks Canadian exporters have faced during the current dispute.
What makes Section 338 especially significant is that CUSMA origin does not provide the protection exporters have come to expect. A qualifying Canadian product can still face the 50% duty when its tariff code falls within the covered lists. The rules were modified again in September, and certain covered products are scheduled to be barred from U.S. importation altogether beginning September 29. At the same time, Section 338 generally does not apply where a product is already subject to a Section 232 tariff, an important safeguard against simply adding the two rates together.
Metal Tariffs Have Become a Product-Level Calculation
Canadian exporters of products containing steel, aluminum or copper face another complicated system under Section 232 of the Trade Expansion Act. Washington originally raised major metal tariffs to 50%, but the regime has since evolved into a range of rates depending on the product and its composition. As of 2026, affected metal goods and derivatives can face additional duties ranging from 15% to 50%. The calculation also shifted from focusing primarily on metal content to, for many covered goods, using the full customs value of the imported product.
Canada and Mexico received a partial adjustment beginning in June 2026. For qualifying CUSMA products in designated categories, a 25% duty can be applied to the non-U.S. portion of the product, subject to a minimum effective rate of 15%. That still requires manufacturers to document exactly where components originated. The practical consequences have been substantial. During Canadian parliamentary testimony, an Ontario tool manufacturer described an identical 72-cavity mould that incurred about US$135,000 in tariff costs after an April rule change, illustrating how quickly a familiar cross-border order can become financially different when classifications or valuation rules change.
Automobile Tariffs Turn North American Content Into a Dollar Figure
Passenger vehicles and light trucks imported into the United States have faced a 25% Section 232 tariff since April 2025. The system is particularly important to Canada because North American vehicle production rarely fits neatly inside one country. Engines, transmissions, electronics and other components can come from plants on both sides of the border before final assembly. For CUSMA-qualifying vehicles, U.S. rules permit approved importers to apply the 25% tariff only to the vehicle’s non-U.S. content rather than its entire customs value.
Auto parts receive different treatment. CUSMA-qualifying parts are currently exempt from the 25% tariff while the U.S. government develops a mechanism for applying duties specifically to non-U.S. content. That makes origin documentation far more than routine paperwork. A manufacturer able to demonstrate substantial U.S. value can face a materially smaller duty bill than one unable to document the same supply chain. There is also an important interaction with the newer Section 338 measures: products already subject to Section 232 are generally excluded from the Section 338 duty. In other words, importers cannot safely calculate exposure by simply adding 25% and 50%; they have to determine which legal regime governs the product.
Softwood Lumber Shows What Real Tariff Stacking Looks Like
Canadian softwood lumber provides one of the clearest examples of multiple U.S. duties genuinely applying at the same time. Since October 14, 2025, covered softwood timber and lumber have faced a 10% Section 232 tariff, with no CUSMA exemption. That tariff was added to a much older dispute involving U.S. anti-dumping and countervailing duties on Canadian lumber. Unlike several newer tariff programs that contain explicit unstacking rules, Washington has stated that the Section 232 lumber tariff applies in addition to those trade-remedy duties when a product falls within both regimes.
The resulting effective burden can be striking. Under the most recently effective sixth administrative review, the “all others” anti-dumping and countervailing cash-deposit rates together total 35.16% for affected companies. Adding the 10% Section 232 tariff produces a potential combined burden of 45.16% on covered shipments, although actual rates vary by exporter and product. New exporters and individually reviewed companies can face different rates. Even Atlantic Canadian lumber that qualifies for exemptions from anti-dumping and countervailing duties is not automatically exempt from the separate Section 232 charge. For sawmills working on tight commodity margins, those distinctions can decide whether an American order remains commercially viable.
Furniture and Cabinets Carry Their Own 25% Wood-Product Tariff
Finished wood products face a different Section 232 problem. Since October 2025, the United States has imposed a 25% tariff on specified upholstered wooden furniture as well as certain kitchen cabinets, bathroom vanities and related parts. Unlike the Section 301 tariff applied to many other Canadian products, these duties do not disappear simply because merchandise qualifies under CUSMA. A Canadian manufacturer therefore can satisfy North American origin rules and still encounter a substantial border charge.
The arithmetic quickly becomes tangible for smaller producers. A covered cabinet shipment valued at US$20,000 would generate US$5,000 in additional Section 232 duty at the current 25% rate before freight and other applicable border costs are considered. The potential burden could increase again soon. The United States originally planned to raise the upholstered-furniture rate to 30% and the cabinet-and-vanity rate to 50% at the beginning of 2026, but postponed those increases for one year while negotiations continued. Unless the policy changes again or an agreement alters the treatment, those higher rates are scheduled for January 1, 2027. That approaching deadline adds another planning problem for Canadian manufacturers quoting U.S. customers months in advance.
Section 301 Makes CUSMA Paperwork Worth 10 Percentage Points
Another broad U.S. tariff took effect on July 24, 2026, under Section 301 of the Trade Act. Washington imposed duties following investigations into what it described as inadequate restrictions or enforcement involving goods produced with forced labour across 60 economies. Canada was assigned a 10% tariff rate, alongside a group of countries receiving the lower of the two principal rates used in the action. Other investigated economies generally faced a 12.5% rate, subject to separate product exclusions and arrangements.
For many Canadian exporters, however, the most important feature is the CUSMA exemption. Goods properly qualifying for preferential treatment under the agreement can avoid the Canadian Section 301 tariff. That gives origin certification a financial importance it did not always have when normal U.S. tariff rates were already zero or very low. Merely manufacturing a product in Canada is not enough; the good must satisfy the agreement’s applicable rule of origin, and preferential treatment must be claimed with appropriate certification. A documentation error can therefore turn into a 10% cost difference at the border. The Section 301 measure replaced the temporary Section 122 import surcharge that expired the same day, continuing the rapid succession of legal authorities being used to impose U.S. duties.
The End of De Minimis Makes Even Small Parcels Tariff-Relevant
The seventh pressure point is technically different from the others because it is not a separate tariff rate. Instead, the United States eliminated the duty-free de minimis treatment that once allowed most imported shipments valued at US$800 or less to enter without ordinary customs duties. The change took effect globally on August 29, 2025. U.S. Customs and Border Protection states that qualifying low-value shipments from all countries, including Canada, are now subject to applicable duties, taxes and fees rather than automatically clearing under the old US$800 exemption.
That distinction matters particularly for smaller Canadian businesses built around direct-to-consumer sales. A large manufacturer shipping truckloads to an American distributor already expected customs paperwork. A craft producer, apparel company or specialty retailer mailing a US$150 order often did not. Removing de minimis means a shipment no longer becomes irrelevant to tariff policy simply because it is small. Whatever Section 301, Section 338 or other applicable duty attaches to the merchandise can now matter at much lower transaction values. The result is not literally a seventh tariff stacked onto the parcel, but a seventh border rule that can expose previously protected Canadian sales to duties and additional customs administration.
