Data on how many Canadian companies are CUSMA-compliant is not readily available. An analysis of the effect of tariffs by the Yale Budget Lab<\/a> published on Thursday assumed that 50 per cent of Canada’s exports to the U.S.\u00a0are now certified.<\/p>\n Meredith says applying for CUSMA exemptions can be a daunting process for small businesses. But he said that faced with higher tariffs, they may be considering either taking on the costs of certification \u2014 or looking at markets beyond the U.S.<\/p>\n “We are one of the most trade-dependent on the United States of any developed country,” said Meredith, a former economic adviser to the Trudeau government.<\/p>\n “If the consequence is that trade overall falls, as we are seeing now in the data, that’s going to be a cost that we disproportionately bear relative to other countries.”<\/p>\n Prior to Trump’s tariffs, Canadian exporters could trade with the U.S. under Most Favoured Nation (MFN)<\/a>\u00a0status. That allowed them to trade\u00a0with very low tariffs \u2014 or none at all \u2014 without registering for\u00a0preferential treatment under CUSMA.<\/p>\n All World Trade Organization (WTO) members, such as Canada, have MFN status when trading with each other.<\/p>\n How do Canadian goods get preferential treatment?<\/p>\n Products are certified CUSMA-compliant<\/a> if they meet the agreement’s rules of origin. Their eligibility is determined on a case-by-case basis since they must meet product-specific requirements.<\/p>\n A certain amount of the product needs to be made in Canada with Canadian inputs to qualify for an exemption.<\/p>\n Steve Mallia, owner of Starfield Optics, a Toronto-based manufacturer of telescopes and accessories, said registering his small business for CUSMA benefits “wasn’t a priority” until Trump began threatening Canada’s sovereignty and economy in January.<\/p>\n “We saw our orders dry up literally overnight so we knew we had to make a change,” said Mallia, who runs the business with his wife Natalie.<\/p>\n Steve Mallia, left, and his wife Natalie run the Toronto-based telescopes and accessories manufacturer, Starfield Optics. (Submitted by Steve Mallia)<\/p>\n His only other employees are a part-time bookkeeper and a chartered accountant, he said.<\/p>\n In the past eight months, Mallia has been researching the process for claiming preferential treatment under CUSMA \u2014 without the same legal resources as a large corporation.<\/p>\n The experience has made him feel that “the little guy” is being forgotten by the Canadian government during the trade war, he said.<\/p>\n “This is the part that takes up a lot of time and costs money,” Mallia said.<\/p>\n “The last thing I want is to ship something and then, you know, customs gets ahold of [the product] and they go, ‘You know what? He didn’t use the right colour ink.'”<\/p>\n Since March, more Canadian exporters reported that they would absorb tariff costs or raise prices than apply for relief through Canada’s remission program, according to a report\u00a0published in July by the Canadian Federation of Independent Business (CFIB)<\/a>. In exceptional circumstances, the federal program<\/a>\u00a0grants companies relief from the payment of tariffs applied as of March 4\u00a0on products from the U.S.\u00a0or issues refunds for tariffs already paid.<\/p>\n The federation, which advocates for the interests of small businesses, surveyed its members about the actions they have taken to mitigate risks during the trade war.<\/p>\n Why not fire back with more counter-tariffs?<\/p>\n Carney was asked on Tuesday whether he would retaliate against the U.S. with a new tariff rate, days after failing to reach a deal by the Aug. 1 deadline.<\/p>\n “We’ve always said we will apply tariffs where they had the maximum impact on the United States and minimum impact in Canada,” he said.<\/p>\n Unlike most countries<\/a> subjected to Trump’s tariffs, Canada has a comprehensive trade agreement with the United States in CUSMA.<\/p>\n WATCH | Trump imposes ‘Liberation Day’ tariffs:\u00a0<\/p>\n The country is also one of few to have retaliated against the U.S.<\/a> in response to Trump’s economic disruption, a step Canada took\u00a0before the U.S. targeted virtually all of its global trade.<\/p>\n Wednesday, Trump threatened to\u00a0hit goods imported from India with a total of 50 per cent tariffs, citing New Delhi’s continued purchases of Russian oil.<\/p>\n And Trump imposed tariffs on dozens of countries’ exports\u00a0last week<\/a> through an executive order. Tariffs\u00a0now vary\u00a0between 10 per cent for the U.K. and 41 per cent on war-torn Syria. That same order brought the total tariff rate of Brazil \u2014 Latin America’s largest economy \u2014 to a staggering 50 per cent<\/a>.<\/p>\n![\"Steve](\"https:\/\/www.newsbeep.com\/ca\/wp-content\/uploads\/2025\/08\/b95fb82a416ead7c9c4c6350ac019056.jpeg\"\/)
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