Supreme Court Ruling Brings Some Relief to Canadian Businesses Amid CUSMA Uncertainty

While sectoral tariffs remain, small businesses see short-term wins from court's decision to strike down Trump's global tariffs.

Feb. 25, 2026 at 7:06pm

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Canadian business groups say trade uncertainty continues to linger ahead of the formal review of the trade agreement between Canada, the U.S. and Mexico, known as CUSMA. However, they are finding some reasons for hope following the U.S. Supreme Court's recent decision to curtail global tariffs imposed by former President Trump. The ruling has "changed a little bit of the thinking" around tariffs overall, even as separate sectoral tariffs remain in place for Canadian industries like steel, aluminum, automobiles, lumber and cabinetry.

Why it matters

The Supreme Court's decision to strike down Trump's "Liberation Day" tariffs and fentanyl-related duties on Canada, Mexico and China provides short-term relief for Canadian small businesses that sell goods not covered by CUSMA, which were previously subject to a 35% levy. However, the bigger worry is what the future of CUSMA will look like, as the trade agreement is due for a formal review this summer.

The details

In response to the Supreme Court ruling, President Trump signed an executive order to enact a 10% worldwide tariff. Canadian Federation of Independent Business president Dan Kelly says the court's decision has "changed a little bit of the thinking" around tariffs, even as separate sectoral tariffs remain in place for key Canadian industries. Kelly notes the ruling will be especially felt by small businesses that sell goods not covered by CUSMA, which were previously subject to a 35% levy.

  • The U.S. Supreme Court struck down Trump's "Liberation Day" tariffs and fentanyl-related duties on Canada, Mexico and China last week.
  • A formal review of the CUSMA trade agreement between Canada, the U.S. and Mexico is due this summer.

The players

Dan Kelly

President of the Canadian Federation of Independent Business.

Donald Trump

Former U.S. President who responded to the Supreme Court's decision by signing an executive order to enact a 10% worldwide tariff.

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What they’re saying

“The ruling has "changed a little bit of the thinking" around tariffs overall, even as separate sectoral tariffs remain in place for Canadian industries like steel, aluminum, automobiles, lumber and cabinetry.”

— Dan Kelly, President, Canadian Federation of Independent Business (castanet.net)

What’s next

The Trump administration's top trade czar has told CBC that Canada will have to accept "some level of higher tariff" if it wants to reach a new trade deal with Washington, adding to the uncertainty around the future of CUSMA.

The takeaway

While the Supreme Court's ruling provides short-term relief for some Canadian businesses, the ongoing trade uncertainty and the looming CUSMA review continue to weigh heavily on the minds of Canadian business leaders, who are navigating a complex and ever-changing trade landscape.