Economic support | City of Ottawa

Tariff toolkit

U.S. tariffs on Canadian goods have come into effect, posing a significant challenge for Ottawa’s economy.

Below is some information to help you understand the impact of tariffs on the local economy and how residents and business owners can help support Canadian and local producers and businesses as they adapt to a rapidly evolving situation.

What are tariffs?

Tariffs are a tax on imported goods, paid by the person or company that imports them. The cost of the tariff is typically passed on to the consumer in the receiving market in the form of higher prices, similar to a sales tax. Tariff revenues are collected by the receiving country’s revenue agency and are not a payment from one government to another. Tariffs are used by governments to generate revenue, protect domestic industries and, in some cases, as a negotiation tactic to achieve trading partner cooperation on another issue. Tariffs can significantly reduce the flow of goods between countries and incent a country to invest in expanded production and manufacturing capacity to reduce reliance on imported goods. For Canada, the threat of U.S. tariffs may accelerate the removal of interprovincial trade barriers to make it easier for businesses to sell their products across the country.

How do tariffs impact me?

With the imposition of Canadian counter-tariffs, Canadian consumers will experience higher prices when purchasing goods imported from the U.S as well as for domestically produced goods with American components. Successive free trade agreements between Canada and the U.S. reduced or eliminated tariffs, leading to integrated supply chains, with some products, such as automobiles, crossing the border multiple times through intermediate processing before reaching their final buyer. The impact of escalating tariffs on prices is difficult to predict, given the high level of economic integration between Canada and the U.S.

How do tariffs impact my business?

Canadian tariffs will have a significant impact on Canadian businesses that sell or buy goods from the United States. Tariffs imposed on Canadian goods make them more expensive for American consumers to buy and reduce our competitiveness in that market. Similarly, tariffs imposed on American goods increase the cost of imported goods, and domestic products with components from the Unites States. Canadian businesses may be forced to raise prices if substitutes cannot be located domestically or sourced from other trade partners.

How can I protect my business from the impacts of tariffs?

Given the potential for tariffs to be implemented with little or no notice, the Ottawa Board of Trade recommends that local businesses take steps to:

Review Supply Chains and Explore New Markets: Identify dependencies on U.S. imports and markets and explore alternatives where possible.
Financial Planning: Prepare for potential cost increases by evaluating pricing strategies, managing cash flow, and considering the impact on profit margins.
Stay Informed: Keep abreast of developments related to the tariffs by subscribing to updates from reputable sources, including the Ottawa Board of Trade's communications.
Engage in Advocacy: Participate in advocacy efforts by sharing your perspectives with industry associations and government representatives to ensure that the business community's voice is heard.
Explore Support Programs: Investigate government programs and resources that may help during this period, such as export support services and financial aid programs.

What can residents do to support local businesses?

Local businesses are operating in an environment of considerable uncertainty about our trading relationship with the United States. Residents can enhance the resiliency of Ottawa’s economy by participating in the following community-led initiatives.

Made in Canada

The City of Ottawa is encouraging residents to consider buying Canadian products and food brands whenever possible. Labels to look for at the grocery store include “Product of Canada” and “Made in Canada”. Residents can consult the Made in Canada Grocery Store Guide(link is external), a comprehensive list of domestic brands and products, to inform purchasing decisions.

Buy Local

Residents should continue their strong support of small and locally owned businesses. The City’s Business Improvement Areas can provide information on businesses in their areas. Shop Ottawa(link is external) maintains an online directory of local businesses, products and services, while Savour Ottawa(link is external) provides a Buy Local Food Guide(link is external) to help support local food producers in our region.

Remember to share positive local shopping experiences and newly discovered restaurants, shops and products with friends and family, and support local businesses and entrepreneurs on social media by amplifying their messaging or providing a positive review. These small actions can have an enormous impact!

What is your local government doing to respond to current economic uncertainty?

While the full impact of tariffs on Ottawa’s economy is not yet known, City Council is working proactively to do whatever it can to help residents and businesses navigate the current situation.

Mayor Sutcliffe convened a task force of key economic partners to share best practices and tools and develop an action plan, such as the development of this tariff toolkit and upcoming launch of a Buy Local/Buy Canadian campaign, to support residents and businesses. He recently issued a joint statement with the Mayor of Ville de Gatineau, to the Premiers of Ontario and Quebec, requesting the strategic removal of interprovincial trade barriers to improve the ability of businesses on both sides of the Ottawa River to sell their products and services. Mayor Sutcliffe also carried this important message to Mayors from across Ontario and Canada and spoke directly with the Prime Minister to highlight the need for both a Team Ottawa and Team Canada approach to addressing current economic uncertainty.

City Council recently approved a motion to ensure the City’s procurement by-laws and processes are flexible and support the purchase of local, Canadian, and non-American goods and services wherever possible. City staff have already done some work and, moving forward, any procurement under $125,000.00 will require that at least one of the three required bids will be from a local supplier.