Canadians are paying an estimated $100 million a week in higher prices because of the federal government's retaliatory tariffs against the United States, a University of Calgary economist told MPs.Trevor Tombe, an economics professor and former Privy Council consultant, told the House of Commons foreign affairs committee the tariffs are effectively taxes on Canadian consumers, with lower-income households bearing a disproportionate share of the costs.“Just for consumers, not even for businesses, it’s about $100 million per week of additional costs,” Tombe testified.“Those costs might be worth paying if one is making an argument that there are non-economic objectives that these tariffs achieve. I don’t know what those might be.”Blacklock's Reporter said the Carney government imposed its latest round of retaliatory tariffs September 8, targeting approximately $28 billion in American imports in response to U.S. tariffs introduced August 22.The Canadian tariffs range from 15% on American agricultural equipment and household appliances to 25% on construction materials and 50% on smartphones, furniture, aluminum and steel manufactured in the United States.Tombe said the costs are ultimately passed along to Canadians purchasing the affected products.“These are taxes and they are paid by Canadians,” he told MPs.“Last year, the round of retaliation we levied raised about $4 billion in federal revenue over the six months they were in place.”Tombe estimated the latest tariffs could increase consumer prices by approximately 0.25 percentage points while adding $100 million in weekly expenses for Canadian households.He warned the financial consequences would be particularly severe for Canadians already struggling with the cost of living.“The burden is hardest on those least able to afford it,” said Tombe.“I estimate households earning less than $30,000 may lose about half a percent of their disposable income as a result just of the newly enacted retaliatory tariffs. That is triple the hit to those earning about $150,000.”Small businesses are also facing mounting financial pressure from the ongoing trade dispute.Dan Kelly, president and CEO of the Canadian Federation of Independent Business, told the committee nearly 30% of small businesses fear they could be forced to permanently shut down if the trade war continues for another year.“There is almost 30% of small firms that say they are worried their business may permanently close if this trade war was to last over the course of the next year,” Kelly testified..He said the median monthly cost reported by affected small businesses has reached approximately $80,000.“It’s quite significant an impact,” Kelly said.The testimony comes after Industry Minister Mélanie Joly defended the government's retaliatory measures as a calculated attempt to put political pressure on Republican-controlled states in the United States.Speaking to reporters August 25, Joly said Ottawa was deliberately selecting American products to maximize political consequences south of the border.“We’re targeting products that will target states in the United States,” Joly said.“We’re being wise and strategic, to put political pressure. And that’s why we think it’s the right thing to do right now.”Asked which states were being targeted, Joly pointed to categories of American exports rather than identifying individual states.“It includes appliances, it includes food products and beverages, etcetera,” she replied.A reporter subsequently asked whether the purpose of the tariffs was to make Americans in Republican states feel the financial consequences.“It was always clear,” Joly responded.The minister maintained Canada had to respond to American trade restrictions while ensuring its retaliation was carefully planned.“Of course we’ll fight back,” said Joly. “Of course emotions are high, but while this is all happening we will be smart and we will be strategic.”.Tombe's testimony highlighted the domestic economic costs of that strategy, including higher consumer prices, reduced household purchasing power and additional financial pressure on businesses.His estimates suggest the latest tariffs could cost Canadian consumers approximately $5.2 billion over a full year if the measures remain in place at their current levels.Joly, meanwhile, defended the government's approach as necessary to protect Canadian interests during the trade dispute.“We’ll just stand up for what we have,” she said. “Meanwhile, I really think while all these shenanigans are happening we will just be smart and we will be strategic and will fight back.”
