Amendment to Duties To Address the Flow of Illicit Drugs Across Our Northern Border
The order amends a February 2025 executive order that imposed tariffs on Canadian goods over illicit drug flows, carving out products that qualify as duty-free under the U.S.-Mexico-Canada Agreement and cutting the tariff on potash from 25 percent to 10 percent, effective March 7, 2025.
It is designed to shield the U.S. automotive industry, which routinely moves parts and components across the Canadian border under USMCA terms, from disruption caused by the broader drug-flow tariff regime.
What this order does
What it orders
The order amends Executive Order 14193 (February 1, 2025), which had imposed additional tariffs on Canadian goods in response to the flow of illicit drugs across the northern border. The amendment exempts from those additional tariffs any Canadian goods that qualify for duty-free treatment under the U.S.-Mexico-Canada Agreement, including related treatment in the Harmonized Tariff Schedule. It also separately reduces the additional tariff rate on potash — a fertilizer mineral — from 25 percent to 10 percent for goods not covered by the USMCA exemption.
All modifications apply to goods entered for consumption, or withdrawn from warehouse for consumption, on or after 12:01 a.m. Eastern Standard Time on March 7, 2025. The order does not create any enforceable legal right or benefit for any private party against the United States.
Who it affects
U.S. and Canadian automotive manufacturers and suppliers that import auto parts and components under USMCA terms, importers of Canadian potash, and U.S. businesses and farmers that purchase potash-based fertilizers.
Why it matters
Automotive supply chains that move parts across the U.S.-Canada border under USMCA are shielded from the 25 percent tariff that had taken effect in February. Potash importers — and the agricultural producers who buy fertilizer — face a lower 10 percent rate rather than 25 percent.
What must happen and when
How the order is supposed to work
The changes are self-executing through the Harmonized Tariff Schedule: goods that clear customs on or after March 7 under USMCA general note 11 treatment are automatically exempt from the additional duty, and potash entries are assessed at 10 percent rather than 25 percent. No agency rulemaking, reporting, or action plan is required; the modification takes effect at the border upon entry. The broader northern-border tariff emergency declared in EO 14193 remains in place for non-USMCA Canadian goods.
Actions and deadlines
- Apply USMCA tariff exemption and reduced potash rate to qualifying goods entered for consumption