The ongoing trade relationship between the United States and Canada faced fresh tension this week after President Donald Trump announced a new 10% increase in tariffs on Canadian goods. The decision, confirmed on October 25, 2025, adds to an escalating dispute triggered by an advertisement from Ontario featuring former U.S. President Ronald Reagan and adds uncertainty to North America’s trade climate.
The controversy began when Ontario, Canada’s most populous province and an industrial center—especially for automobiles—aired a high-profile, C$75 million (approximately US$54 million) advertising campaign. The ad, broadcast during the World Series baseball championship between the Toronto Blue Jays and the Los Angeles Dodgers, featured selectively edited excerpts from Reagan’s 1987 radio address critiquing tariffs. The intent, according to Ontario officials, was to highlight the economic benefits of free trade, but the spot drew swift condemnation from the White House and Reagan’s estate.
President Trump publicly characterized the advert as a “hostile act,” saying it misrepresented Reagan’s views and sought to sway the American public as the U.S. Supreme Court prepares to hear a crucial case on the president’s authority to impose tariffs unilaterally. Trump criticized Canadian officials online for not immediately removing the ad during the World Series. Following the backlash, Ontario Premier Doug Ford agreed to pause the campaign in Ontario starting Monday. However, the ad continued to air in other provinces and over the weekend, which further frustrated U.S. officials. In a statement cited by Time, Trump said the increased tariffs were justified in light of Canada’s actions.
The Reagan Foundation joined the criticism, asserting that the advertisement rearranged Reagan’s words and visuals without permission, misrepresenting the legacy of the 40th U.S. president.
Trade between the U.S. and Canada is governed primarily by the U.S.-Mexico-Canada Agreement (USMCA), which took effect in 2020. Although most Canadian exports to the U.S. are shielded by this agreement, certain goods—especially metals—have been subject to new tariffs since early 2025. The details of which products would be affected by the new 10% tariff remain unclear as of reporting. In 2023, Canada exported approximately $450 billion worth of goods to the U.S., making the American market critical to Canadian manufacturers, particularly those in Ontario’s automotive sector.
Reacting to Trump’s announcement, Canadian Prime Minister Mark Carney emphasized the importance of engagement, expressing hope for continued negotiations and constructive results for workers and families on both sides of the border. However, Trump stated he has no current plans to meet with Carney during the upcoming Association of Southeast Asian Nations (ASEAN) summit in Malaysia.
Meanwhile, the White House left the door open to the eventual resumption of formal trade talks but stopped short of announcing any concrete steps toward de-escalation. Canadian officials have publicly called for a return to direct negotiations and an end to the tariff increases.
Industry leaders and trade analysts have warned about the negative effects of heightened tariffs on U.S.-Canada economic competitiveness, supply chains, and jobs. With both governments trading barbs and the dispute reaching pop culture—social media users, politicians, and sporting events have all referenced the episode—bilateral relations remain strained. Nevertheless, observers believe there remains room for diplomatic solutions if both sides are willing to lower tensions.
For more detailed coverage of the dispute and its background, see sources including Yahoo News, Reuters, and AP News.