Trump’s tariffs against Canada raise legal questions
US President Donald Trump imposed 50% tariffs on $20 billion worth of Canadian imports, citing Section 338 of the Tariff Act of 1930. Canada responded with tariffs of a similar amount, and Washington’s decision escalated relations between the two countries. As PBS NewsHour reports, the president’s authority to impose tariffs under this provision has not previously been used or tested in court.
A Great Depression-era provision
Section 338 is part of the Tariff Act of 1930, also known as the Smoot-Hawley Act. It allows the president to impose duties of up to 50% on imports from countries that discriminate against US businesses. The Trump administration invoked this provision, alleging that Canada discriminates against US exports of dairy products, automobiles, and alcoholic beverages.
Lawyer and former US trade official Ryan Majerus noted that the law has no judicial precedent. According to legal researchers Peter Harrell and Jennifer Hillman, the United States had previously only considered using Section 338: against Spain in 1932 and China in 1949, but did not use it.
Arguments over the legality of the tariffs
Some lawyers believe that Section 338 may have been superseded by later US trade laws that established specific grounds and procedures for imposing tariffs. Liberty Justice Center CEO Sarah Albrecht said there are strong arguments supporting this position.
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Harrell and Hillman also noted that Section 338 provides for tariffs intended to offset harm from discriminatory trade practices. In their view, the US administration did not calculate the amount of such harm to American producers, while the tariffs extended to Canadian goods unrelated to the named sectors, including hockey sticks and cement. They recalled that Canada’s system of dairy tariffs above established quotas was agreed in the North American trade agreement concluded by Trump with Canada and Mexico during his first term.
Former chief counsel of the Office of the US Trade Representative John Veroneau believes that tariffs under Section 338 may be justified if a country taxes US imports at higher rates than goods from other countries. He noted that Canada imposed tariffs on US goods in response to Trump’s earlier tariffs.
No plaintiffs yet
No lawsuits have yet been filed against the new Section 338 tariffs. Liberty Justice Center is seeking companies willing to challenge them in court. Albrecht explained that there are few willing parties because suing the government is difficult. These tariffs cover about 5% of Canadian imports into the United States, so fewer companies pay them than Trump’s global tariffs of 2025.
