WASHINGTON — President Trump on Monday said the United States will impose a 50 percent tariff on all Canadian cars, trucks, auto parts and steel effective Jan. 1, 2027, delivering the sharpest escalation of the U.S.-Canada trade war since 50 percent duties on about $20 billion of other Canadian goods took effect Saturday.

Trump announced the auto and steel levy on Truth Social, writing that "Tariffs on all Cars, Trucks, both large and small, Automotive Parts, and Steel, will be increased to 50%" on Jan. 1, 2027. He said U.S.-built vehicles would not be hit and added, "Canada will be treated like a State no longer!" Non-U.S. autos and parts currently face a 25 percent U.S. tariff; Canadian steel already carries a 50 percent levy. Monday's move extended a weekend arc that began with Ottawa's Friday-night walkout from talks and 50 percent U.S. duties on hundreds of Canadian goods — including hockey sticks, wine, dairy and cement — that took effect Saturday.

Ottawa's reply

Canadian Finance Minister François-Philippe Champagne and other cabinet ministers will unveil Canada's response at 11 a.m. ET Tuesday, the Department of Finance Canada said. Prime Minister Mark Carney has already pledged dollar-for-dollar retaliatory tariffs beginning Sept. 8 on U.S. steel, dairy, appliances, agricultural equipment, pulp and paper and electronics.

Carney, speaking Monday, called the auto threat unsurprising and accused Trump of wanting to destroy Canada's auto industry. He said talks would resume only if Washington arrived with the "right attitude." Ontario Premier Doug Ford, whose province anchors Canadian auto manufacturing, told Trump to "kiss my ass" and floated surcharges on Canadian oil, gas, electricity and critical minerals. Canada supplies 60 percent of U.S. crude oil imports and close to 100 percent of U.S. natural gas exports, according to Canadian government data. Trump on Truth Social called Ford's response "bluster" and warned, "Someone should get these clowns to 'fall in line' or, the consequences for Canada will be far WORSE!"

Small business squeeze

Businesses on both sides said the speed of the levies, not only their size, is the problem. Cindy Baldassi, whose Calgary jewellery firm CindyLouWho2 draws 75 percent of sales from Americans, told the BBC, "It's quite likely that it will wipe out most of my US sales." She added, "I expect that at least half of my business will be gone."

In Portland, Ore., Mike Roach and Kim Osgood said the Canadian-made pillow that is the bestseller at their Paloma Clothing shop, priced at $59, would carry a normal markup to between $86 and $90 under the new duty. "It would be one thing if we had three months' notice - that would be something you could plan around, do some work with the vendors," Roach said. "But when it happens literally overnight you're really stuck."

Matteo Sgaramella, founder of Toronto menswear brand Outclass, said U.S. retail orders placed in January will arrive in September carrying a fresh 50 percent bill: "There's going to be a lot of people that go out of business because of this."

Who pays

Trade attorney Barry Appleton, co-director of the Center for International Law at New York Law School, told CBS News that the auto duty falls first on American buyers. "This tariff is collected at the American border, from American car dealers and American buyers," Appleton said. "When people hear 'tariffs on Canada,' they should understand the first invoice usually lands in a Michigan showroom, not in Ottawa."

The administration pressed the opposite frame. U.S. Trade Representative Jamieson Greer told CNBC that Ottawa collapsed Friday's deal by demanding more: "They wanted more." A July presidential proclamation, invoking Section 338 of the Tariff Act of 1930, called Canada's 25 percent tariff on non-USMCA U.S. vehicles "unreasonable." Oxford Economics warned Monday that "the risk of the USMCA unravelling has increased," a rupture that "would plunge Canada into recession and leave it on a permanently lower growth path."

Champagne speaks at 11 a.m. Tuesday. Canada's retaliatory tariffs take effect Sept. 8.