Trump's tariffs show a smaller direct border impact for Canada.

Headline U.S. tariff rates rose in 2025, but a study found actual import duties paid were much lower and CUSMA exemptions meant nearly 90% of Canadian exports remained duty‑free by late 2025; a joint CUSMA review is scheduled for July 2026.

The U.S. announced large tariff increases in 2025, but the practical effect at the border has been more muted. A recent academic study reported that the statutory tariff rate was much higher than the rate U.S. importers actually paid. Canadian exporters used CUSMA-origin exemptions and documentation to continue duty-free shipments. A joint review of the Canada-United States-Mexico Agreement (CUSMA) is scheduled for July 2026. Key points: - A study by Gita Gopinath and Brent Neiman reported a September 2025 statutory U.S. tariff rate near 27.4% but an effective rate paid of about 14.1%. - U.S. exemptions for already-shipped goods, targeted product exemptions, and widespread use of CUSMA origin documentation reduced the duties applied at the border. - By the end of 2025, roughly 90% of Canadian exports continued to cross into the U.S. duty‑free, according to the reporting. - The study also reported that tariff costs passed through almost one‑for‑one into U.S. import prices and were largely borne by U.S. firms; a joint CUSMA review is set for July 2026. Summary: The headline tariff announcements in 2025 overstate the border-level effect because exemptions and rules of origin limited duties on many shipments. Reported data show lower effective tariff rates and ongoing duty‑free access for most Canadian exports, while tariff costs were largely reflected in U.S. import prices. The next formal procedural step is the CUSMA joint review in July 2026, which will address the agreement's future terms.