A week after Republican Gov. Phil Scott called on President Donald Trump to stop levying 10% tariffs on Canadian aluminum, the president moved to drop the import tax on Tuesday.
That decision came just hours before Canada planned to retaliate with its own taxes on imports from its southern neighbor.
The tax on Canadian aluminum was implemented on imports from Vermont’s northern neighbor at the beginning of August and the policy drew widespread criticism from businesses, members of Congress and governors, who argued the move damages the economy and U.S.-Canada relations.
On Sept. 8, Scott, accompanied by New Hampshire Republican Gov. Chris Sununu and Maine Democratic Gov. Janet Mills, wrote a letter to Trump telling the president the tariff would hurt the economy in northern New England during a time when states are already struggling because of the Covid-19 pandemic.
Reps. Peter Welch, D-Vt., Annie Kuster, D-N.H., Chris Pappas, D-N.H., and Chellie Pingree, D-Maine, also sent a letter to Trump asking him to reverse his decision to tax Canadian aluminum imports. They also expressed “full support” for the letter sent by the governors of their states.
“Trade with Canada is critical for Vermont’s and our neighboring border states’ economies,” Scott said in a statement Wednesday.
“This is why Governor Mills, Governor Sununu and I advocated for this policy change, and I was grateful Congressman Welch and his colleagues did so as well,” he added. “Reversing these tariffs is beneficial for many Vermont businesses, and I appreciate the White House taking this important step.”
Companies in Vermont, New Hampshire and Maine have strong ties with Canada, and about half of all trade in those three states is conducted with the bordering country, according to Scott’s office.
Québec is also the largest trading partner for Vermont companies, with around $5 billion in trade crossing the border annually.
Aluminum has long been a source of trade dispute between the U.S. and Canada with the Trump administration claiming that Canada is exporting large volumes of steel and aluminum products to the U.S., depressing prices and hurting U.S. producers.
The decision by the White House in August to levy a 10% tariff on aluminum came just one month after the North American trade deal — the United States-Mexico-Canada Agreement — went into effect at the start of July.
In August, Trump said that he had decided to reimpose the tax on Canada because the country was “taking advantage of us as usual.”
The president had imposed tariffs on steel and aluminum from Canada, Mexico and the European Union in 2018, which led to retaliatory tariffs on U.S. imports. Trump did not lift the tax on Canada and Mexico until 2019 when all three countries reached a deal on the updated North American Free Trade Agreement (NAFTA).
Soon after Trump placed the new tariff on Canadian aluminum, Prime Minister Justin Trudeau said he would retaliate with his own tariffs on U.S. imports.
The White House’s reversal Tuesday came just hours before Canada was set to release its own levies — totalling roughly $3.6 billion.
