US ‘Likely’ to Give Canada One-Month Tariff Pause on Goods Covered by USMCA: Commerce Secretary Lutnick

Lutnick said the decision comes from Canada and Mexico having done ‘an enormous amount of work’ on fentanyl.

U.S. Commerce Secretary Howard Lutnick in a file photo. Madalina Vasiliu/The Epoch Times

U.S. Commerce Secretary Howard Lutnick says he expects there will be a one-month tariff reprieve for all products compliant with the United States-Mexico-Canada Agreement (USMCA).

“It’s likely that [the reprieve] will cover all USMCA compliant goods and services, so that which is part of President Trump’s deal with Canada and Mexico are likely to get an exemption from these tariffs now,” Lutnick said during an interview with CNBC aired March 6.

Lutnick said the decision comes from Canada and Mexico having done “an enormous amount of work” on fentanyl.

Lutnick said he expects U.S. President Donald Trump will “come to the agreement today” that these USMCA-compliant goods will be exempted from tariffs until April 2. He said the tariffs decision after that reprieve will be focused on “fentanyl and the border” and though the U.S. administration acknowledges progress on border security, it wants to see “a reduced number of autopsy deaths from fentanyl” in the United States.

“Hopefully Mexico and Canada will have done a good enough job on fentanyl that this part of the conversation will be off the table and it will move just to the reciprocal tariff conversation,” Lutnick said.

April 2 is the day that a second round of U.S. tariffs is set to apply, this time targeting countries that tariff the United States. That round of tariffs would mirror the level of tariffs that the countries have put on American products.

A White House official speaking on background to The Epoch Times reacted to Lutnick’s comments by saying that while the tariffs were “fluid,” Lutnick’s “remarks and reporting are in the right direction” on the USMCA pause.

Hours after Lutnick’s interview with CNBC, Trump announced on his Truth Social platform that Mexico would not be required to pay tariffs on “anything that falls under the USMCA Agreement” until April 2. Trump said he made the change “out of respect” for Mexican President Claudia Sheinbaum, and that the two countries were “working hard together” on border security.

Trump did not mention a reprieve for Canada on tariffs, but in a separate post repeated his accusations from the previous day that Prime Minister Justin Trudeau is “using the tariff problem” to stay in power.

Trudeau had a call with Trump on March 5 which didn’t result in a breakthrough on tariffs. He said on March 6 that Canadian officials have been engaged in “ongoing conversations” with the U.S. administration but “we don’t yet have anything to officially announce.”

Canada Tariffs

On March 4, the United States put 10 percent tariffs on Canadian energy exports and 25 percent tariffs on all other Canadian products. Ottawa then retaliated with 25 percent tariffs on $30 billion worth of U.S. goods, with another $125 billion of imports to be tariffed after 21 days.

Trump said on March 3 that there was “no room left” for Canada and Mexico to avoid tariffs and that “vast amounts of fentanyl” are entering the United States from the bordering countries. Trump has tied the tariffs to the two countries’ efforts to stop illegal immigration and drug smuggling, and granted a 30-day tariff pause back in early February after Canada and Mexico announced further measures on border security.

In reaction to the U.S. tariffs on March 4, Trudeau cast doubt on fentanyl being the real justification for the tariffs, and instead suggested Trump is using them to collapse Canada’s economy to facilitate its “annexation.”

On March 5, the United States announced that the big three automakers—Ford, Stellantis, and General Motors—along with any cars from Canada and Mexico that comply with the USMCA trade deal would get a one-month exemption on tariffs.