Canada Section 338 Tariffs: 50% on Vehicles, Dairy & Alcohol From August 19, 2026

Three presidential proclamations published July 23, 2026 impose an additional 50% ad valorem duty on listed Canadian products under Section 338 of the Tariff Act of 1930 — a rarely-used statute that authorizes duties against countries found to discriminate against US commerce. The duties take effect for goods entered on or after 12:01 a.m. ET, August 19, 2026. See the proclamation of Jul 23, 2026 (motor vehicles; parallel proclamations cover dairy and alcoholic beverages).

What's covered

• Motor vehicles — responding to Canada's 25% tariff on US vehicles that don't qualify under USMCA and its content-based tariff on qualifying ones.
• Dairy products — responding to Canada's dairy TRQ administration.
• Alcoholic beverages — responding to provincial liquor-board restrictions on US products.

USMCA does not save you here

Unlike the 10% general tier (where Annex provisions may spare qualifying goods), the Section 338 proclamations apply to listed products regardless of USMCA qualification. Goods admitted to US foreign-trade zones on or after the effective date must enter as privileged foreign status and pay the duty on consumption entry.

What Canadian-origin importers should do before August 19

• Check whether your HTS codes appear in the proclamation annexes.
• Entries before 12:01 a.m. ET August 19 are under the old rate — timing of entry for consumption matters.
• Model the 50% impact on your landed cost — for listed goods this is usually the difference between viable and not.