(The Center Square) – The Office of the U.S. Trade Representative opened public comment Monday on the future of the U.S.-Mexico-Canada Agreement without asking what tariffs on Canadian and Mexican goods have cost American importers or consumers.
Tariffs now in place will cost the average U.S. household about $820 this year, according to Tax Foundation estimates. About 16% of that, roughly $130 per household, is attributable to tariffs on Canadian and Mexican goods, Alex Durante, a senior economist at the Tax Foundation, told The Center Square.
The federal government has estimated who pays for the tariffs but not what they cost, and the administration has not provided a figure. USTR did not respond to questions sent Monday morning about whether it has produced one or why tariff costs were left out of the comment request. The White House, asked in August whether the administration had produced an estimate of the tariffs' cost to the average household, responded to other questions and did not address that one.
The Congressional Budget Office estimated in February that foreign exporters absorb 5% of tariff costs and that U.S. consumers ultimately bear the remaining 95% through higher prices, including from domestic producers that raise prices as import competition falls. In May, CBO told Congress that more recent evidence indicated the share absorbed by foreign exporters may have risen to 10% to 15% by the end of 2025. The agency has not translated either estimate into a dollar figure for households, and has published none specific to Canadian and Mexican goods.
"I am not aware of any federal estimates," Durante said.
The notice asks the public to comment on five subjects: how the agreement is operating, whether Canada and Mexico are complying with it, what actions the United States should take, the investment climate and economic security.
The review follows the administration's decision in July not to renew the agreement. The United States "did not agree to renew the USMCA in its current form," U.S. Trade Representative Jamieson Greer said in a July 1 statement, after the pact's Free Trade Commission met virtually. The agreement remains in force and now faces a review every year. It terminates July 1, 2036, unless all three countries confirm they wish to continue it.
Written comments and requests to testify are due Jan. 12, 2027, through dockets USTR-2026-0595 and USTR-2026-0596 on the agency's comment portal. USTR has not set a date or location for the public hearing.
About $124 billion in imports from Mexico are covered by tariffs imposed under Section 301 and Section 232 this year, Durante said, with the rest exempt under the agreement. About 73% of U.S. imports from Canada and 75% from Mexico still enter duty-free under USMCA.
The United States imposes a 50% tariff on about $22 billion in Canadian imports under Section 338 of the Tariff Act of 1930, according to the Tax Foundation. Section 232 tariffs cover about $407 billion in autos and auto parts and about $320 billion in steel, aluminum and copper imported from all countries. A Section 301 tariff of 10% to 12.5% on 60 trading partners took effect July 24, the day a 10% global tariff imposed under Section 122 of the Trade Act of 1974 expired. Canada and Mexico are both subject to the 10% rate.
Existing USMCA provisions remain in force, David Gantz, Will Clayton Fellow in Trade and International Economics at Rice University's Baker Institute for Public Policy, told The Center Square. The annual reviews continue until the three countries agree on a 16-year extension or the agreement expires, he said, and nothing prevents them from negotiating in the meantime. Talks between the United States and Mexico are ongoing.
The annual cycle creates uncertainty for investors, Caleb Petitt, a research fellow at the Independent Institute, told The Center Square. A horizon that shrinks every year makes it harder for investors to expect that the policy environment when they put money in will still hold when the investment pays off, he said.
Still, Petitt said, an annual review is better than the agreement collapsing. Under the annual cycle, he said, "it is relatively easy for longer, more stable arrangements to be made."
Greer told the House Ways and Means Committee in April that the administration had reviewed six years of data on the agreement. "We don't think we're in a position to rubber-stamp the deal," he said. "We now have six years of data, and we see problems."
The comment period closes Jan. 12, and the cost question is not among the five USTR is asking.
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