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Section 338 duties on Canadian goods: alcoholic beverages dispute

Canada alcohol-dispute tariff (Section 338)

In effectSince Aug 22, 2026

What it is

The President found that Canada discriminates against U.S. commerce (Canadian provinces and territories stopped buying, distributing or selling U.S. alcoholic beverages from March 2025 while still selling other countries' drinks) and, under Section 338, put an extra 50% on a list of 63 Canadian products from Aug 22, 2026 (a 3-day suspension moved the start from Aug 19). The list isn't limited to drinks. On Sep 15, 2026 the list changed (34 subheadings added; 2 statistical lines, whisky other than bourbon or rye, and liqueurs, in containers over 4 liters, removed) and goods under Section 232 tariffs stopped being exempt. From Sep 29, 2026, 53 of the listed products (28 of them only when packaged in bottles, cans, boxes, kegs or similar containers) can't be imported at all (Proclamation 11061); goods imported before then still pay the 50% when entered.

Legal authority: Section 338 of the Tariff Act of 1930 (19 U.S.C. 1338); Proclamation 11046 of Jul 20, 2026, as amended by Proclamation 11056 and Proclamation 11064. Section 338 of the Tariff Act of 1930 lets the President impose additional duties of up to 50% on goods from countries that discriminate against U.S. commerce.

It reaches 103 listed tariff codes or code groups (a listed heading or subheading covers every code under it).

Check a product

Rates

"+" rates are added on top of the regular duty. Chapter 99 headings are the numbers filed on the entry along with the product's own code.

  • +50%Aug 22, 2026 to Sep 14, 2026
    Origin
    Canada
    Products
    Products under 2203.00.00, 2204.10.00, 2204.21.20, 2204.21.30, 2204.21.50, 2204.21.60, 2204.21.80, 2204.22.20, 2204.22.40, 2204.22.60, 2204.22.80, 2204.29.61, 2204.29.81, 2205.10.30, 2206.00.15, 2206.00.30, 2206.00.45, 2206.00.60, 2206.00.90, 2207.10.30, 2208.20.10, 2208.20.20, 2208.20.30, 2208.20.40, 2208.20.50, 2208.20.60, 2208.30.30, 2208.30.60, 2208.40.20, 2208.40.40, 2208.40.60, 2208.40.80, 2208.50.00, 2208.60.10, 2208.60.20, 2208.60.50, 2208.70.00, 2208.90.10, 2208.90.12, 2208.90.14, 2208.90.15, 2208.90.20, 2208.90.25, 2208.90.30, 2208.90.35, 2208.90.40, 2208.90.50, 2208.90.72, 2208.90.75, 3301.19.10, 4413.00.00, 4419.90.91, 4420.90.80, 4421.91.60, 4421.91.70, 4602.19.80, 4804.11.00, 4806.20.00, 4810.13.19, 4811.59.60, 4811.90.80, 4811.90.90, 9506.99.25 (63 codes listed)
    Heading
    9903.03.12
  • +50%Since Sep 15, 2026
    Origin
    Canada
    Products
    Products listed in U.S. note 51(b)(1) to chapter 99, subchapter III (101 codes listed)
    Heading
    9903.03.12

How it combines with other duties

Charged on top of the base rate and any other chapter 99 duty, including the forced-labor Section 301 tariff and, from Sep 15, 2026, Section 232 duties (before then goods under the listed Section 232 headings were exempt). Goods eligible for USMCA or other special rates still pay it. It doesn't apply to "goods for which entry is properly claimed under a provision of chapter 98 of the tariff schedule", "except for goods entered under subchapter XXIII of chapter 98 of the tariff schedule, subheadings 9802.00.40, 9802.00.50 and 9802.00.60, and heading 9802.00.80". For 9802.00.40, 9802.00.50 and 9802.00.60 it applies to "the value of repairs, alterations or processing performed", and for 9802.00.80 to "the value of the article assembled abroad, less the cost or value of such products of the United States" (U.S. note 51(a)). Antidumping and countervailing duties still apply.

Exemptions

Where an exemption turns on a legal condition, the condition is quoted exactly as the law states it.

Exempt when another tariff applies instead (8)

  • Steel, aluminum and copper goods under Section 232Origin: CanadaLegal text: articles subject to duties pursuant to section 232 of the Trade Expansion Act of 1962, as amended (19 U.S.C. 1862)9903.03.15 · Until Sep 14, 2026
  • Cars and light trucks under Section 232Origin: CanadaLegal text: articles subject to duties pursuant to section 232 of the Trade Expansion Act of 1962, as amended (19 U.S.C. 1862)9903.03.15 · Until Sep 14, 2026
  • Car and light-truck parts under Section 232Origin: CanadaLegal text: articles subject to duties pursuant to section 232 of the Trade Expansion Act of 1962, as amended (19 U.S.C. 1862)9903.03.15 · Until Sep 14, 2026
  • Wood products under Section 232Origin: CanadaLegal text: articles subject to duties pursuant to section 232 of the Trade Expansion Act of 1962, as amended (19 U.S.C. 1862)9903.03.15 · Until Sep 14, 2026
  • Medium and heavy trucks and buses under Section 232Origin: CanadaLegal text: articles subject to duties pursuant to section 232 of the Trade Expansion Act of 1962, as amended (19 U.S.C. 1862)9903.03.15 · Until Sep 14, 2026
  • Medium and heavy truck parts under Section 232Origin: CanadaLegal text: articles subject to duties pursuant to section 232 of the Trade Expansion Act of 1962, as amended (19 U.S.C. 1862)9903.03.15 · Until Sep 14, 2026
  • Semiconductors under Section 232Origin: CanadaLegal text: articles subject to duties pursuant to section 232 of the Trade Expansion Act of 1962, as amended (19 U.S.C. 1862)9903.03.15 · Until Sep 14, 2026
  • Patented medicines under Section 232Origin: CanadaLegal text: articles subject to duties pursuant to section 232 of the Trade Expansion Act of 1962, as amended (19 U.S.C. 1862)9903.03.15 · Until Sep 14, 2026

Exempt for certain uses (1)

  • Civil aircraft (note 51(d))Origin: CanadaCodes listed in U.S. note 51(d) to chapter 99, subchapter IIILegal text: articles of civil aircraft (all aircraft other than military aircraft and unmanned aircraft); their engines, parts and components; their other parts, components and subassemblies; and ground flight simulators and their parts and components the product of Canada, that otherwise meet the criteria of General Note 6 of the HTSUS9903.03.16

Import bans

These goods can't be imported at all while the ban is in force, whatever the duty.

  • Products on Proclamation 11061's import-ban listOrigin: CanadaSince Sep 29, 2026
  • Products on Proclamation 11061's import-ban list marked "Packaged"Origin: CanadaOnly where: alcohol products that are packaged in bottles, cans, boxes, kegs, or other similar direct-to-consumption containersSince Sep 29, 2026

What changed

Sources

  1. Proclamation 11046 of Jul 20, 2026, Imposing Additional Duties To Offset Canadian Discrimination (Alcoholic Beverages), 91 FR 46639, Jul 23, 2026
  2. Proclamation 11056 of Aug 18, 2026, Temporary Suspension of Additional Duties (Canada), 91 FR 54789, Aug 24, 2026
  3. Proclamation 11064 of Sep 8, 2026, Modifying the Scope of Products of Canada Subject to the Additional Duties (Alcoholic Beverages), 91 FR 58331, Sep 14, 2026
  4. Proclamation 11061 of Sep 8, 2026, Excluding Certain Canadian Products From Importation (Alcoholic Beverages), 91 FR 58311, Sep 14, 2026
  5. CBP, CSMS # 69606660, GUIDANCE: Section 338 Additional Duties on Certain Goods of Canada, with CBP's list of classifications, 2026-08-21
  6. CBP, CSMS # 69851916, Modifying Section 338 Additional Duties on Certain Goods of Canada, 2026-09-11
  7. CBP, CSMS # 70050970, Certain Canadian Products Excluded from Importation into the United States; Presidential Proclamations 11061, 11062, and 11063, with CBP's annexes, 2026-09-28
  8. HTS 2026 Revision 20, chapter 99, subchapter III, U.S. note 51
  9. HTS 2026 Revision 20, headings 9903.03.12 to 9903.03.16

Checked against these sources on Oct 1, 2026. Rates shown are what CBP collects; antidumping and countervailing duties are separate.

All Section 338 tariffs