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The Tariff Is the Tax

This week Ottawa’s retaliatory tariffs on $27.6 billion of American goods took effect, and Mark Carney framed the whole exercise as Canada finally standing up for itself, talks won’t resume, he said, until the Americans stop throwing shade. It’s a satisfying sentence to read in a headline. It’s a much less satisfying line to find on a receipt, because the invoice for standing up for ourselves gets sent almost entirely to us.

Governments under this kind of pressure need a lever that is visible and reads as decisive, and a tariff is exactly that lever, a button anyone can point to and say we did something. Whether that something helps is a separate question nobody in Ottawa seems eager to answer cleanly. The Hub puts the potential hit to Canadian consumers at close to $4 billion, while economists quoted elsewhere argue the reciprocal tariffs probably won’t move grocery prices much at all. Both claims can be broadly true at once, since the pain just lands somewhere other than the produce aisle, on hardware, on parts, on whatever slice of that $27.6 billion happens to run through your particular supply chain.

A tariff, stripped of the flag waving, is a tax collected at our own border and handed to our own government, paid in practice by whoever imports the goods and then passed along to whoever buys them. Calling that retaliation against the United States is a framing trick, a tidy bit of language that lets the cost disappear behind the target. The tariff does eventually cost the American exporter something too, in lost sales and reduced competitiveness, but the cheque that clears first is written here.

None of this means retaliation was the wrong call, trade fights sometimes need a response with teeth to be taken seriously. But there’s a difference between accepting a cost and pretending it belongs to someone else, and Canadian politics keeps choosing the second option because it plays better on camera. If we’re going to tax ourselves to make a point to Washington, the least we owe each other is admitting that’s exactly what we’re doing.

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