US President Donald Trump said on Tuesday that he is “probably so” going to reduce the recently increased tariffs on Canada after Ontario suspended a surcharge on electricity exports to the United States.
Speaking to reporters at the White House, Trump discussed his decision to hike tariffs on U.S. imports, saying that he “had to do this,” as reported by Reuters.
Ontario has agreed to suspend its 25% surcharge on electricity exports to three US states, Premier Doug Ford announced on Tuesday.
The decision came just hours after U.S. President Donald Trump announced that tariffs on all steel and aluminum products imported from Canada would increase to 50% in response to the electricity surcharge.
In a post on Truth Social, Trump stated that he had instructed Commerce Secretary Howard Lutnick to impose an additional 25% tariff, set to take effect Wednesday morning.
“I’ve agreed to suspend the tax temporarily and we always have that tool in our tool kit,” Ford told reporters in Toronto Tuesday afternoon.
“This was the right decision. They understand how serious we are about the electricity and the tariffs, and rather than going back and forth and and having threats to each other, we have both agreed that cooler heads prevail.”
Ford characterized a call from US Commerce Secretary Howard Lutnick as an olive branch as they agree to meet on Thursday in Washington. The premier is to be accompanied by Federal Finance Minister Dominic LeBlanc.
“I respect Ontario’s decision to suspend 25% surcharge,” President Trump said after Ford’s announcement.
Canada is by far the top supplier of both steel and aluminum to the United States. The neighboring country exported $9.4 billion worth of aluminum to the U.S. in 2024, significantly ahead of the second-largest exporter, the European Union, which exported $1.5 billion.
Canada also exported $7.1 billion worth of steel last year, compared to $7 billion from the European Union.
In his first post, Trump also revived the idea of Canada joining the US as the 51st state.
“The artificial line of separation drawn many years ago will finally disappear, and we will have the safest and most beautiful Nation anywhere in the World — And your brilliant anthem, ‘O Canada,’ will continue to play, but now representing a GREAT and POWERFUL STATE within the greatest Nation that the World has ever seen!” Trump wrote.
Trump also repeated the claim that the US subsidizes Canada by over $200 billion annually.
However, economist Jim Stanford, director of the Centre for Future Work in Vancouver, disputed these figures in an article published the University of British Columbia.
According to US data, the bilateral trade deficit was $40 billion in 2023, down 29% from 2022, with a further 9% decline in the first nine months of 2024.
“Compared to a two-way trade flow of almost $1 trillion per year, this imbalance is puny,” Stanford said.
He also noted that the US enjoys a surplus in services trade and investment income from Canada, which helps offset any trade deficit.
“Most Canadian exports to the US are unfinished inputs that American businesses rely on for production. Tariffs would increase costs for these materials, reducing US firms’ competitiveness in both domestic and export markets,” he explained.
