Trump’s Tariffs Backfire — Canadians’ Revenge Plan Likely to Cost America $5.7 Billion in Lost Revenue
When Donald Trump returned to the White House for his second term in January, one of the first things he focused on was changing America’s tariff system. He said many countries were taking advantage of the United States, so he wanted to increase taxes on imported goods. On April 2, 2025, he announced a long list of new tariffs that affected many nations around the world.
Some tariffs were as low as 10%, while others went up to 50%. Even though Canada was not included in the new list, the country was already dealing with a 25% tariff on most of its imports to the U.S., except oil and energy, which were taxed at 10%.
In July, things became even more tense when the U.S. raised tariffs on Canadian goods to 35%. Canada reacted immediately. The Canadian government introduced its own set of retaliatory tariffs, including a 25% tax on American cars and trucks, along with extra taxes on several other U.S. products. Some Canadian provinces even banned the sale of American alcoholic drinks, making the situation worse.
As these battles over tariffs continued throughout the year, something unexpected happened: everyday Canadians began refusing to visit the United States.
According to CBC News, a report from the U.S. Travel Association showed that international tourism spending dropped by 3.2% in 2025. This loss added up to around $5.7 billion less than the year before. Many analysts believe this decline is strongly linked to Trump’s tariff decisions and the harsh language he has used toward Canada—such as calling it “the 51st state” and mocking the government repeatedly.
Normally, Canadians are the biggest group of international visitors to the United States. In 2024, they made up 28% of all 72.4 million foreign tourists. But in 2025, that number fell to 24%. The drop may look small on paper, but because the tourism industry involves so many jobs—hotels, restaurants, airports, shops, theme parks, and more—the impact could be very serious over time.
A business professor, Usha Haley from Wichita State University, explained that fewer Canadian tourists could lead to fewer hotel bookings, fewer workers needed, less tax revenue for local governments, and possible financial stress for cities that depend heavily on tourism. Since tourism runs at a fast pace and needs a lot of workers, any drop in visitors can quickly affect the entire system.
As winter and the holiday season began, many Canadians started choosing vacations in Asia or Europe instead of the United States. The U.S. Travel Association now predicts that America could face a travel deficit of nearly $70 billion in 2025.
In October, during a joint press conference with Canadian Prime Minister Mark Carney, Trump was asked about the fall in tourism. He responded sharply, saying Americans “don’t want to buy cars made in Canada,” but also insisted that relations between the two countries would eventually improve because there is “great love” between them.
Travel experts say things may get better in 2026 due to big events like the FIFA World Cup and celebrations for America’s 250th anniversary. But many Canadians who feel offended by Trump’s policies might stay away for as long as he remains president.
One Canadian, Rena Hans from Toronto—who owns a condo in Florida and usually spends winters there—said she refuses to return while Trump is in office. She explained that she doesn’t want to spend her money in a country whose leader talks about taking over Canada and has created huge trade barriers. Instead, she is traveling to Costa Rica, Turks and Caicos, China, and Taiwan. She believes the world is big, and there are many other places to enjoy a holiday.
A new Angus Reid survey supports her view. Out of 1,607 Canadians questioned, 70% said they feel uncomfortable traveling to the U.S. this winter.
Besides tariffs, new border rules have also made things harder. Canada and other foreign visitors now face stricter checks and must pay a new mandatory entry fee. The U.S. Department of Homeland Security says these rules are meant to improve national security.
In October, the situation grew even more tense when Trump stopped all trade negotiations with Canada. He became angry after the Ontario government ran a $75 million advertisement in the U.S. that included a famous clip of former President Ronald Reagan warning Americans about the dangers of tariffs. Trump took it personally and shut down communication on trade.
All these actions higher tariffs, stronger border rules, political tension, and angry exchanges have pushed many Canadians to stay away from the U.S., hurting the American tourism industry more than expected. What started as a trade strategy has now turned into a costly problem that could affect millions of workers and billions of dollars in revenue.
Whether things improve depends largely on politics, public opinion, and how both countries handle the next stage of their relationship.
