New U.S. tariffs on Canadian imports took effect Aug. 22 after trade talks between the two countries broke down, raising concerns for Washington businesses that rely on cross-border trade.
The tariffs could reach 50% on about $20 billion worth of Canadian products, including alcohol, dairy and other goods, in addition to existing tariffs. Canada has announced plans to respond with tariffs on U.S. products beginning Sept. 8, including steel, dairy, appliances, electronics, pulp and paper, and farm machinery.
Washington is particularly exposed to changes in U.S.-Canada trade. The state imported about $8.5 billion in Canadian goods during the first half of 2026 and exported roughly $4 billion in goods to Canada during the same period. However, the immediate economic impact may be limited because the new U.S. tariffs affect only about 5% of Canadian exports to the United States. Energy products, which account for more than half of Washington’s Canadian imports this year, are not affected by the new tariffs.
Trade experts say businesses may also be better positioned to absorb disruptions than during previous trade disputes. Many companies have diversified suppliers and markets after earlier tariff battles, making supply chains more resilient.
Still, uncertainty remains a concern for businesses as tariffs and potential retaliatory measures evolve. The extent of the impact on Washington will depend on which products are ultimately affected and how businesses respond to changing costs and supply conditions.
