From left, Sen. Susan Collins, R-Maine, and Sen. Lisa Murkowski, R-Alaska, talk as they arrive for a vote in the U.S. Capitol on Wednesday, April 30, 2025.
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Republican Sens. Susan Collins and Lisa Murkowski are joining Democrats to back a new bill that would exempt millions of U.S. small businesses from President Donald Trump’s tariffs on Canadian goods.
The two-page bill, titled the “Creating Access to Necessary American-Canadian Duty Adjustments Act” — which shortens to the CANADA Act — comes as Trump threatens to slap a blanket 35% tariff on Canadian imports starting Aug. 1.
The tariff threat is the president’s latest salvo in an on-again, off-again trade war with America’s longtime economic and political ally, which is the largest export partner for nearly three dozen U.S. states.
“Imposing tariffs on Canada, Maine’s closest trading partner, threatens jobs, drives up costs, and hurts small businesses that have long relied on cross-border cooperation and exchange,” Collins said in a statement in support of the new bill.
Murkowski in her own statement said, “I’ve heard loud and clear from small businesses in Alaska: tariffs are forcing prices to rise and making it difficult to plan long-term.”
“I’m hopeful this legislation sends a clear message to the administration that we want to continue this strong partnership by alleviating the effects of these tariffs on our small businesses,” she said.
The legislation introduced by Sen. Peter Welch, D-Vt., is cosponsored by five other Democrats including Senate Minority Leader Chuck Schumer of New York and Oregon’s Ron Wyden, the Senate Finance Committee’s ranking member.
The bill targets the tariffs that Trump first announced on Feb. 1, a 25% blanket duty on Canadian goods imported to the United States and a 10% tariff on Canadian energy imports.
If enacted, the legislation would make those tariffs inapplicable “with respect to goods imported by or for the use of small business concerns” as defined under federal law.
The White House did not immediately respond when CNBC requested a comment on the bill and asked if Trump would consider signing it, should it make it to his desk.
In a phone interview with CNBC on Wednesday, Welch said that other U.S. tariffs targeting Canada — including Trump’s threatened 35% duty — will “all be on the table.”
The impact of Trump’s tariffs goes beyond concerns that they will ultimately raise prices on U.S. consumers, Welch said.
“Vermonters really love Canadians, and are very upset about what has happened to the relationships that many of our businesses have built up over the years,” the senator said.
Likewise, Canada “understandably is furious and hurt by the way they’ve been treated” by the U.S., and that has affected Vermont’s hospitality industry, he added.
Canadian travel to Vermont — and the U.S. in general — is reportedly down sharply so far this year.
Trump said he imposed the Feb. 1 tariffs in response to Canada’s alleged failure to stop the flow of drugs and crime over the U.S. northern border. But he quickly issued a 30-day pause on those tariffs, after then-Canadian Prime Minister Justin Trudeau vowed to take steps to address Trump’s concerns.
In a March 2 executive order, Trump further amended the Canada tariffs by delaying the end of the so-called de minimis trade exemption, a carve out which allowed low-value goods shipments to enter the U.S. duty free.
The Canada tariffs — alongside 25% duties on Mexican goods and a total 20% import tax on China — nevertheless took effect on March 4, prompting retaliation from Ottawa.
One day later, Trump granted a monthlong tariff pause for major U.S. automakers whose cars comply with the trilateral North American trade pact known as USMCA.
The day after that, Trump issued temporary tariff exemptions for USMCA-compliant imports from Canada and Mexico. That covered about 38% of goods entering the U.S. from Canada, the White House said at the time.
Canada was excluded from Trump’s April 2 “liberation day” tariffs, which imposed a near-global 10% duty and significantly higher rates on dozens of individual countries. But Ottawa has continued to grapple with U.S. blanket tariffs on its imports of steel and aluminum and autos.
