Trump Considering Tariff Relief For Mexico, Canada, Commerce Secretary Lutnick Says

The first two months of the Trump Administration have seen back-and-forths within the Executive Branch on the timing and magnitude of the United States’s tariffs on its neighbors Mexico and Canada. The administration appears set to roll back some of the tariffs placed on Tuesday.

What Happened: Commerce Secretary Howard Lutnick appeared on Bloomberg Television on Wednesday to discuss the status of Trump’s tariffs. Lutnick says Trump will make his decision on tariffs on Wednesday afternoon.

"There are going to be tariffs, let's be clear, but what he's thinking about is which sections of the market that maybe he'll consider giving them relief until we get to, of course, April 2," Lutnick said. "I think it is going to be in the middle somewhere."

In particular, the administration could reduce tariffs on automobiles. Experts say tariffs could increase car prices by up to 25%.

Lutnick says the administration will place reciprocal tariffs on the rest of the world on April 2.

Why it Matters: This is not the first time Trump's tariff plans have shifted from his initial proposals. In February, Trump announced tariffs against Mexico and Canada but then delayed their enactment until March.

Trump’s tariff policies have drawn criticism from some members of his party.

“US tariffs inevitably bring Canadian, Mexican, and Chinese tariffs which means higher prices for lumber, steel, aluminum and more expensive homes and cars,” Sen. Rand Paul (R-KY) posted on X on Tuesday.

Sen. Mitch McConnell (R-KY), former Senate Majority Leader, also denounced Trump’s tariff plans as “bad policy.”

Others, such as Sen. Bernie Moreno (R-OH) see the short-term pain associated with the tariffs as worth it to curb immigration from U.S. neighbors.

Tariffs are taxes paid by American importers, and consumers often pay them in the form of price hikes. Consequently, many economists see tariffs as counterproductive.

Still, Trump’s policies have found support among unions, particularly the United Auto Workers.

“For 40 years, we've seen the devastating effects of so-called "free trade" on the working class… Tariffs are a powerful tool in the toolbox for undoing the injustice of anti-worker trade deals,” the union said in a Tuesday statement. “We are glad to see an American president take aggressive action on ending the free trade disaster that has dropped like a bomb on the working class.”

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