(Photo Illustration by Thomas Fuller/SOPA Images/LightRocket via Getty Images)
UPDATE: It looks like Ontario is delaying canceling the Starlink subsidies after President Trump agreed to postpone the tariffs on Canada for 30 days.
In response, Ontario’s Premier Doug Ford tweeted: "With the US pausing tariffs, Ontario will also pause our retaliatory measures. If President Trump proceeds with tariffs, we won’t hesitate to remove American products off LCBO shelves or ban American companies from provincial procurement."
Original story:
Canada is hitting back at Trump's plan to tariff the country’s exports by going after SpaceX, where Trump ally Elon Musk serves as CEO.
On Monday, Ontario’s Premier Doug Ford announced a ban on US companies in provincial contracts. This includes Ontario's November deal to use SpaceX's Starlink to supply high-speed internet to 15,000 underserved homes and businesses.
"We’re going one step further. We'll be ripping up the province’s contract with Starlink. Ontario won’t do business with people hellbent on destroying our economy,” Ford tweeted. "Canada didn't start this fight with the US, but you better believe we're ready to win it.”
Ontario was originally set to spend $100 million CAD (US$68 million) in government subsidies to Starlink, which included paying for the dish hardware and installation fees for eligible residents. But it looks like Ford has decided to pull the funding to punish Musk, who is now heading up an unofficial effort to cut government spending in the US.
Days earlier, Canada’s former finance minister urged the country to consider placing a 100% tariff on Tesla's electric cars, Musk’s other major business.
The news highlights how Trump’s trade war is threatening to quickly escalate and ensnare consumers. It also raises the prospect of Canada directly placing tariffs on SpaceX's Starlink business, which serves at least 400,000 users in the country.
Trump’s tariffs on Canada take effect on Feb. 4 and place a 25% duty on imports from the country, although shipments of Canadian crude oil will only receive a 10% levy.
The White House also planned to impose a 25% tariff on Mexican goods and a 10% tariff on products from China, but Trump said this morning that he reached a deal with Mexico to delay the tariffs for one month.
China and Mexico are both home to numerous electronics factories, and Trump says the tariffs are intended to pressure all three countries to crack down on illegal immigration to the US and fentanyl drug shipments. But critics, including industry lobbying groups, say the tariffs will raise prices for many products.
“Tariffs are taxes on American consumers, not foreign governments or companies,” said the Consumer Technology Association, which represents the leading tech firms. “Increasing tariffs on imports from Canada, China, and Mexico will fuel inflation and raise prices on tech products, automotive manufacturing, and services.”