New Section 338 Import Bans and Tariff Changes

The United States (U.S.) government has announced a new round of Section 338 actions on imports from Canada, modifying the scope of existing tariff coverage while introducing new import bans on select Canadian products. These measures follow the initial Section 338 actions announced earlier this summer and reflect ongoing trade enforcement activity between the U.S. and Canada.

For importers, this is more than a routine tariff update. Companies may need to reassess product classifications, inventory plans, shipment timing, and sourcing strategies as the changes take effect this September. Understanding whether your products are being added, removed, or prohibited will be critical to avoiding unexpected costs and supply chain disruptions.

Why are the measures being expanded?

According to the White House, the latest actions were taken in response to what the administration describes as continued discriminatory treatment of certain U.S. exports and additional Canadian retaliatory measures. The new proclamations modify the scope of previously announced Section 338 tariffs and, in certain cases, move beyond tariffs to prohibit the importation of specified Canadian-origin goods.

The stated objective is to adjust the existing measures while continuing to address the trade concerns identified in earlier Section 338 actions. For a broader view of recent U.S. trade actions and tariff developments, see our U.S. Tariff Timeline.

Which products are being added to or removed from the 50% Section 338 tariffs?

Effective September 15, 2026, the U.S. government revised the list of Canadian products subject to the existing 50% Section 338 duties. The White House stated that certain products are being removed from coverage, while new products are being added to better serve the public interest while maintaining the intended trade effect of the measures.

Products removed from the 50% tariff include:

Rock salt and sodium chloride products
Portland cement products
Certain refined lead products
Selected paper and tissue products
Certain electrical switchgear and switchboard assemblies
Fishing rod parts and accessories
Certain chemically pure sugars

Products now subject to the 50% tariff include:

Additional dairy products, including certain specialty cheeses not made from cow's milk
All-terrain vehicles, golf carts, and certain small passenger vehicles
Iron and steel structural products, including: columns, beams, girders, and structural components
Aluminum products, including: bars, rods, profiles, tubes, and pipes
Welding products, including: welding wire, electrodes, rods, and soldering materials
Flexible metal tubing, rivets, hooks, eyelets, buckles, closures, and other industrial hardware components
Certain boats and marine products, including larger outboard motorboats
Furniture and home furnishing products, including: office furniture, kitchen furniture, seating, mattresses, mattress supports, and furniture parts
Decorative and household lighting products, including: table, desk, floor-standing, and LED lamps
Certain paper and graphic paper products used for printing, writing, and packaging applications

Importers should not assume that products previously covered remain subject to the tariff or that products previously unaffected remain outside the scope. A detailed review of Harmonized Tariff Schedule classifications and supplier product catalogs is strongly recommended before the effective date.

Which Canadian products will be subject to import bans?

In addition to modifying tariff coverage, the administration has issued separate proclamations prohibiting the importation of certain Canadian products. Unlike a tariff, which increases the cost of importing a product, an import ban precludes affected goods from entering the United States once the ban takes effect.

These actions affect selected products within three key sectors:

Alcoholic beverages, such as Canadian wine, beer, and distilled spirits
Dairy products, such as cheese, milk, and cream-based products
Certain motorcycles and related transportation equipment

For many importers, this represents a more significant operational challenge than a tariff increase. While companies can often absorb, pass through, or mitigate higher duty costs, products subject to an import ban may require alternative sourcing strategies or inventory planning if imports can no longer enter the U.S. market.

The import bans are scheduled to take effect on September 29, 2026. Products imported before that date, but not yet entered for consumption, remain subject to the applicable Section 338 tariff treatment rather than the import prohibition.

USMCA and tariff stacking

The White House has stated that the Section 338 tariffs apply to covered Canadian products regardless of whether the goods qualify as originating under the United States-Mexico-Canada Agreement (USMCA). The duties also apply in addition to any applicable Section 232 tariffs.

This means importers should carefully evaluate total landed costs and compliance obligations rather than assuming USMCA eligibility eliminates exposure to the measures.

What should importers do now?

Companies importing from Canada should take immediate steps to assess potential impacts before the September effective dates, including:

Review all Canadian-sourced products against the updated tariff and import-ban announcements to identify potentially affected stock keeping units (SKUs).
Confirm Harmonized Tariff Schedule classifications with customs compliance teams and brokers.
Evaluate shipment timing and inventory strategies for goods that may become subject to new duties or import restrictions.
Engage suppliers and procurement teams to understand sourcing alternatives where necessary.

Looking ahead

The latest Section 338 actions significantly expand the practical impact of the U.S.-Canada trade dispute by modifying tariff coverage and introducing import bans for selected products. Importers should pay close attention to the two key implementation dates:

September 15, 2026, for tariff scope changes, and
September 29, 2026, for the new import prohibitions.

As additional guidance is released by CBP and other agencies, companies should continue to monitor developments and assess the potential impact on their supply chains, landed costs, and compliance processes.