UPDATED 3/6/2025: President Donald Trump announced Thursday he is postponing a 25% tariff on some imports from Canada and Mexico. The order comes after President Trump enacted tariffs earlier this week.
President Trump said tariffs on imports that comply with the 2020 United States-Mexico-Canada Agreement trade pact will be postponed for 30 days. This is the second delay of tariffs on the country’s top trade partners.
President Trump signed an executive order implementing tariffs through the International Emergency Economic Powers Act (IEEPA), noting that the “sustained influx of illicit opioids and other drugs has profound consequences on our nation, enduring lives and putting a severe strain on our healthcare system, public services, and communities.”
Reacting to the announcement, Kentucky Chamber President and CEO made a statement:
“New tariffs on Canada and Mexico will put unnecessary pressure on Kentucky businesses and families. As a state that thrives on trade, we know firsthand how these policies disrupt supply chains, increase costs, and threaten jobs. We’ve seen it before—when Kentucky’s bourbon industry was hit by retaliatory tariffs, it lost nearly $600 million in exports. These policies have real consequences. We urge policymakers to support free enterprise and trade policies that allow Kentucky businesses to compete and grow. Our economy depends on it.”
In addition to the tariffs on the largest trading partners in the U.S., President Trump announced another 10% tariff on goods from China on top of the 10% tariff that went into effect last month.
In response to the tariff announcement on March 3, Canadian Prime Minister Justin Trudeau announced a 25% retaliatory tariff on Tuesday affecting $155 billion worth of U.S. goods. Of this, $30 billion went into effect on Tuesday and the rest on March 25. Mexican President Claudia Sheinbaum said Mexico will announce its response to the tariffs later this week. China announced a 15% tariff on U.S. farm exports on Tuesday. Neither leader has announced a postponement of retaliatory tariffs as of Thursday.
On Wednesday, President Trump’s administration granted a 30-day exemption on tariffs affecting U.S. automobile makers. According to the Associated Press, White House press secretary Karoline Leavitt said President Trump “is ‘open’ to hearing requests from other industries seeking exemptions.”
President Trump said he intends for “reciprocal tariffs” on imports from Canada and Mexico will go into effect on April 2.
“Most of the tariffs go on April the second,” President Trump said before signing the orders. “And then we have some temporary ones and small ones, relatively small, although it’s a lot of money having to do with Mexico and Canada.”
How Will Tariffs Impact Kentucky?
In 2024, Kentucky imported $7.9 billion in goods from Mexico, 36% of which were motor vehicle parts.
The Commonwealth also imported $6 billion from Canada in 2023, including equipment, machinery, minerals, metals, and more.
The Tax Foundation estimates that the average household will spend an additional $830 in 2025 because of price increases in imported goods.
Stay tuned to The Bottom Line for more updates on federal policies.
True Statement. What can Companies in Kentucky do?