Half of small businesses say U.S. no longer reliable trade partner: CFIB
· Toronto Sun
OTTAWA — With Canada now a year into President Donald Trump’s trade war, over half of Canada’s small businesses said the United States is no longer a reliable trading partner.
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That’s according to data released Wednesday by the Canadian Federation of Independent Business, which said small businesses continue to bear the brunt of the fight as they face massive uncertainty.
“Small business owners have been dealing with the whiplash of trying to keep up with sudden changes and threats, including many that don’t happen or are revised within hours,” said CFIB president Dan Kelly.
“With CUSMA (the Canada-U.S.-Mexico Agreement) coming up for review in the months ahead, the stakes are even higher.”
Most small businesses reported strained relationships
According to a survey of their members, 68% of Canadian small businesses owners report being negatively impacted by American tariffs.
As well, three-quarters of Canadian small businesses said ongoing tariff battles have put a real strain on their relationship with American clients or partner businesses. That’s up sharply from the 49% who reported strained relationships when surveyed in March 2025.
Recent U.S. court decisions on Trump’s tariffs, the report said, won’t help everyone.
On Feb. 20, a 6-3 decision by the U.S. Supreme Court ruled the president lacked the authority to impose tariffs under the International Emergency Economic Powers Act (IEEPA,) ruling that tariffs are taxes and therefore leaves the final decision on their application with Congress.
Trump described that ruling as “deeply disappointing,” accusing SCOTUS justices of being “very unpatriotic and disloyal” to the U.S. Constitution.
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While that decision means little to most Canadian exports, the study said it’ll bring relief to the 27% of businesses impacted by tariffs of goods that do not comply with CUSMA.
Tariffs on steel and aluminum, which have been imposed by both Canada and U.S., remain a major challenge for many businesses, the report said — impacting around 44% of Canadian businesses. But government aid put in place to help impacted businesses isn’t doing much.
The CFIB determined that fewer than 1% of those surveyed had applied for relief under Ottawa’s Regional Tariff Response Initiative .
That program, launched in 2025, provides $1 billion over three years to support small and medium-size businesses weather the tariff storm — but CFIB said 77% of Canadian small businesses had no idea the program existed.
Rules too restrictive: Report
But even so, the report said that restrictive eligibility rules make the program inaccessible to those hardest hit
“For example, in British Columbia, businesses must employ at least 10 full-time workers to qualify, while in Quebec — where eligibility is now closed — applications were limited to manufacturing firms with annual revenues of $2 million or more,” the report said.
The CFIB is calling on the federal government to ease the pain by introducing broad tax relief measures, including a 3% decrease in the small business tax rate. They’re also advocating for a rebate program for impacted businesses to ensure rebates and refunds aren’t taxed as income and to stay focused on keeping CUSMA as a means to restore stability and reduce instability in trade.
“Small business owners are telling us they feel abandoned in dealing with tariff costs,” said the CFIB’s Michelle Auger.
“With fewer people starting businesses, we can’t afford to overlook the ones we have. Ottawa needs to step up and find better ways to help.”