As President Donald Trump’s administration continues to send mixed signals about tariffs, Vermont officials and business leaders have been left struggling to adjust for a trade policy that seems to change on an almost hourly basis.
On Thursday, just two days after sweeping tariffs on imports from Canada and Mexico took effect, Trump announced that he would again be postponing many of those levies until April 2.
The delay specifically applies to goods that fall under the umbrella of the 2020 USMCA trade pact, which White House officials have said accounts for only about 38% of goods from Canada and half of goods from Mexico. The pause also applies to the 10% duty that Trump placed on Canadian energy products.
Granting a reprieve on goods ranging from petroleum to maple syrup, the delay could stave off much of the impact of a trade policy that experts have said could raise costs for consumers across the board in Vermont.
But the volatility of Trump’s decision-making has itself become an issue for business and officials trying to assess the impacts that a trade war could have on the state’s economy.
“While the reprieve may ease some short term pressures for some sectors, it does little to resolve the underlying issue of the uncertainty for businesses,” said Amy Spear, president of the Vermont Chamber of Commerce. “The start-stop approach to tariffs creates confusion.”
When — or if — Trump does impose tariffs on a permanent basis, Vermont is uniquely poised to bear the brunt of the emerging trade war with Canada.
The state imports over $2.5 billion in goods from Canada, accounting for over 65% of its overall foreign imports, and exports over $680 million in return to its northern neighbor, according to data from the International Trade Administration. Vermont also imports almost $200 million in goods from China, which has been hit with similar sweeping tariffs that are already in effect.
In particular, the 10% levy on Canadian energy imports, now expected to take effect in April, could escalate costs across the board in Vermont. Canada provides the state with almost 100% of its natural gas and about $775 million of electricity per year, and officials have said consumers would almost certainly bear the impacts if the energy tariff should take effect.
Matt Cota, a lobbyist representing fuel dealers in Vermont, said his members were cautiously celebrating the reprieve, which likely delays the tariffs until after the worst of the cold weather when the need for Canadian fuel will have tapered off. “We’re very happy,” Cota said.
But Cota said the volatility of Trump’s trade policy has still shaken the industry.
During the 72-hour window in which the tariffs were in effect, for example, some Vermont businesses imported Canadian fuel and are struggling to parse how exactly to handle the temporary tax. Some may have already accounted for the tariff in their bills, Cota said, while others may have worked out deals to take care of the duty later.
“It’s all over the map, and yet we still don’t have guidance from Washington, D.C.,” Cota said. “Was it a 72-hour tariff, or did it not exist at all? We don’t have straight answers.”
There was similar confusion on display at Gov. Phil Scott’s weekly press conference Thursday, where just hours before Trump announced the delay on Canadian tariffs, state officials were scratching their heads over how to metabolize the president’s unpredictable trade policy.
“It’s been difficult to keep up in some respects,” Scott said. “That’s been my argument all along, that we cannot, cannot chase every single issue that comes our way over the next four years.”
Noting that the White House had announced the reprieve on Mexican goods just prior to the press conference, Scott said that Trump’s tariff policy “seems to change on a daily basis. I think it just changed in the last few hours.”
Trump originally announced that levies on imports from Mexico and Canada would take effect in early February but postponed the tariffs until March 4. Just two days after they took effect, however, Trump announced that he would be exempting most goods from the tax until April.
And even before the dust from that decision could settle, Trump on Friday suggested he would soon impose yet another round of tariffs, this time targeting Canadian dairy and lumber products.
Trump has also promised to impose “reciprocal tariffs” against trade partners across the board, starting on April 2. It’s unclear how the 25% tariffs on Canadian and Mexican goods, now expected to take effect on that same day, would overlap with that policy.
Canada, meanwhile, has announced retaliatory tariffs that Canadian officials have threatened to keep in place until Trump backs down.
Erin Petenko contributed reporting.
