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Days after the collapse of trade talks with the Trump administration, the Liberal government is rolling out $7.5 billion to help workers and businesses weather the new 50 per cent tariffs being imposed on $27.6 billion of Canadian goods by the U.S. president.
Finance Minister François-Philippe Champagne and other ministers announced Tuesday that alongside the supports for businesses, starting Sept. 8 it will match the U.S. levies dollar for dollar by tariffing $27.6 billion of comparable U.S. goods.
“Our dollar-for-dollar, rate-for-rate counter-tariffs, as well as a multibillion-dollar support package, will protect workers, farmers, families and businesses as we build a stronger, more resilient and more diversified Canadian economy,” Champagne said in a statement.
Officials speaking on background explained that the support package comes on top of the nearly $25 billion in tariff support it implemented over the past 18 months.
The measures have been designed to focus support on workers and businesses, particularly small- and medium-sized enterprises across the country, officials said.
Workers and small businesses
As a part of the support package, the Liberal government is directing $3.5 billion of the $7.5-billion support funding into a rapid response initiative for workers and employers.
Part of the money will go toward expanding three changes to EI first announced in September 2025 that were set to expire Oct. 10, including:
Waiving the one-week waiting period to collect EI for another year. Extending permission for workers to receive EI payments without first having to use up their separation payments until Oct. 10, 2027.Giving long-tenured employees an extra 20 weeks of EI until June of next year.
Two new measures being rolled out include allowing workers that have voluntarily left their jobs to collect EI without penalty, and helping connect unemployed or underemployed workers with major projects that need staff.
Employers themselves are getting up to $1,000 per employee to cover the training and administration costs of implementing EI work-sharing and retention programs.
Financing and loans
The Liberal government is also investing $2 billion to create the Canada Strong Diversification Fund, which will “support tariff-impacted companies with shovel-ready projects that support ongoing capital maintenance, including medium-sized firms.”
Bigger companies will be able to enjoy more flexibility because of changes being made to the government’s Large Enterprise Tariff Loan facility (LETL).
Announced in March 2025, the LETL provides eligible companies with 24 months of financial liquidity. Under Tuesday’s support plan, that 24-month period is being extended to 36 months and the maximum loan repayment period is being raised to 15 years from 10.
Medium-sized enterprises across the country, meanwhile, will be able to access $1.5 billion in additional funding that will be delivered through one of Canada’s seven regional development agencies.
The additional funding lists the cap on non-repayable contributions from $1 million to $3 million while liquidity support will be up to $2 million.
At Issue special edition: Canada-U.S. trade talks collapse and President Donald Trump threatens even more tariffs. Was it the right decision for Prime Minister Mark Carney’s government to walk away and is a deal still possible?
The Business Development Bank of Canada, which will have a second $500-million liquidity stream, will provide working capital support for small- and medium-sized businesses facing cash flow pressures.
Companies directly impacted by the tariffs will also be eligible for loans ranging from $250,000 to $5 million, and will be allowed to make interest-only payments for 36 months.
Canada’s new retaliatory tariff regime
The retaliatory tariffs will target the same goods the Trump administration singled out when it hit Canada with Section 338 and 232 tariffs. Officials speaking on background said the list of the more than 700 products being hit has now been posted online.
U.S. President Donald Trump’s 10 to 50 per cent Section 232 tariffs were applied to steel, aluminum, copper, autos, lumber, their derivatives and certain semiconductors.
The 338 tariffs target a range of Canadian goods, from hockey sticks to alcohol to dairy, and were imposed Saturday after trade talks between the two countries broke down.
Officials explained that Canada’s tariff regime is being designed to protect industries in Canada rather than raise revenues. To do that, Canada’s tariff rate on a given product will match the U.S. tariff rate on that same product.
