NEW YORK — As part of his plan to crack down on drugs and illegal immigrants, President-elect Donald Trump has said that he will put huge new tariffs on Mexico, Canada, and China as soon as he takes office.
If the taxes are put into place, they could make everything from gas to cars much more expensive. According to the most recent Census figures, the U.S. buys more goods than any other country in the world. Its top three suppliers are Mexico, China, and Canada.
In two posts on his Truth Social site Monday night, Trump made the threats. In them, he railed against a flood of illegal immigrants, even though the number of people crossing the southern border has been at an all-time low for four years.
He complained that “thousands of people are pouring through Mexico and Canada, bringing Crime and Drugs at levels never seen before,” even though violent crime is down from pandemic highs. In one of his many first executive orders, he said, “I will sign all the necessary documents to charge Mexico and Canada a 25% tariff on ALL products coming into the United States and its ridiculous open borders.”
He said the new taxes would stay in place “until Drugs, especially Fentanyl, and all Illegal Aliens stop this Invasion of our Country!”
“Both Mexico and Canada have the right and the power to easily solve this problem that has been going on for a long time.” He then said, “We demand that they use this power, and until they do, they will have to pay a very big price!”
Also angry, Trump said, he has “had many talks with China about the huge amounts of drugs, especially Fentanyl, being sent into the United States—But to no avail.”
He wrote, “Until they stop, we will be charging China an extra 10% (on top of any other tariffs) on all of their many products coming into the United States of America.”
It’s not clear if Trump will follow through with his threats or if he’s just trying to get something done before he takes office in January.
Scott Bessent, Trump’s nominee for treasury secretary, has said more than once that tariffs are a way to negotiate. If he is approved, he would be one of several officials in charge of putting tariffs on other countries.
In an opinion piece for Fox News last week, before he was nominated, he said that tariffs are “a useful tool for achieving the president’s foreign policy objectives.” Tariffs can be very important for stopping military aggression, getting partners to spend more on their own defense, opening up foreign markets to U.S. exports, and getting everyone to work together to stop illegal immigration and fentanyl trafficking.
Trump won the election in large part because voters were fed up with inflation. However, the tariffs he has threatened could make prices for food, cars, and other things even higher. The Federal Reserve might need to keep its benchmark interest rates high if inflationary forces rise.
At the same time that Trump is making threats, fewer people are being arrested for crossing the border illegally from Mexico. As of now, U.S. arrests have stayed close to four-year lows. In October, the U.S. Border Patrol made 56,530 arrests, which is less than a third of the number of arrests made in October of last year.
At the same time, more people have been arrested over the past two years for crossing the border from Canada without permission. The Border Patrol arrested 23,721 people from October 2023 to September 2024, up from 10,021 the year before. Indian people made up more than 14,000 of those stopped at the border with Canada. That’s more than 10 times the number from two years ago.
A jury found two men guilty of transporting people illegally last week. They were involved in an international scheme that killed an Indian family trying to cross the border between Canada and the United States during a snowstorm in 2022.
A lot of the fentanyl in the United States comes from Mexico. Under President Joe Biden, the amount of the drug that was seized at the border went up sharply. In 2024, about 21,900 pounds of fentanyl were seized, up from 2,545 pounds in 2019, when Trump was president.
The new taxes would be very bad for the economies of Canada and Mexico in particular if Trump went through with the tariffs he had warned.
Right after Trump’s post, the Canadian dollar USDCAD 0.63% fell heavily on the foreign exchange markets.
There were rumors that Trump was thinking about putting a 25% tariff on the Canadian car industry and his plan to renegotiate the North American Free Trade Agreement (NAFTA) during his first term. These were seen as existential threats in Canada. Canada depends on trade more than any other country in the world. In fact, 75% of its goods go to the U.S.
The taxes would also make it harder to trust the USMCA trade deal that Trump helped make with Canada and Mexico in 2020. This deal replaced NAFTA and will be looked at again in 2026.
From Trump’s social media post, it’s not clear how he would legally raise tariffs on these two important U.S. trading partners, but the 2020 deal allows for waivers for national security reasons.
Officials on Trump’s transition team did not answer right away when asked what power he would use, what he would need to see in order to stop the tariffs from going into effect, and how they would affect prices in the U.S.
As a response to Trump’s higher tariffs during his first time in office, other countries raised their own tariffs. For example, Canada said it would put billions of dollars worth of new tariffs on U.S. goods in 2018 as a reaction to new U.S. taxes on Canadian steel and aluminum.
Many of the U.S. goods were picked because of how they would affect politics rather than the economy. For example, Canada only buys $3 million worth of yogurt from the U.S. every year, and most of it comes from a single plant in Wisconsin, which is where Paul Ryan grew up and is now the Speaker of the Republican House. A 10% tax was put on that item.
In a joint statement, Deputy Prime Minister Chrystia Freeland and Public Safety Minister Dominic Leblanc said that Canada and the US have a close relationship and that they will talk to the new administration about the border and their strong business ties.
“Canada cares very much about border security and keeping our shared border safe.” “Today, our relationship is fair and helpful for both of us, especially American workers,” the statement said.
Freeland is in charge of a special cabinet committee on Canada-U.S. relations that was created to deal with worries about another Trump presidency. Freeland has said that the committee is very concerned about the president-elect’s plan to start a mass deportation campaign because it could cause a lot of people to come to Canada.
Before Trump’s posts, a top Canadian source said that they were expecting him to issue executive orders on trade and the border as soon as he took office. The official wasn’t allowed to talk to the press and asked to remain anonymous.
The Foreign Relations and Economy Departments of Mexico also didn’t respond right away to what Trump said. Such important topics are usually talked about by the president at her morning briefings for the press.
A top Chinese commerce official said last week that higher tariffs on Chinese goods would hurt consumers by making prices go up. Vice Commerce Minister Wang Shouwen also said that China can handle these kinds of “external shocks.”
