Campobello not feeling brunt of U.S.-Canada trade war

As the Trump administration continues to impose new tariffs and restrictions on Canadian trade and Canada counters with tariffs of its own, residents on both sides of the border have been inconvenienced or more seriously affected. Prices for fuel, groceries and many other necessities have risen substantially. But one group of Canadians appears to be weathering the situation calmly - the residents of Campobello Island. That's because they have been granted a special exemption to the direct application of counter‑tariffs, due to their unique geographical situation. Apart from the seasonal ferry to Deer Island, which will stop running for the year on October 12, the only way to get to the island is via the bridge and border crossing from Lubec. With no hospital, no gas station, limited grocery options and no local access to appliances, household goods or other necessities, shopping in Maine is almost unavoidable.

The Trump administration first imposed a 25% tax on Canadian goods in February 2025 because of purported drug smuggling into the U.S. In response, Canada imposed a 25% tax on U.S. goods. Island residents were forced to pay some significant taxes before an exemption was granted on April 8, 2025. After that, the issue settled down until recently. In late August the U.S. announced another round of tariffs of 50% on certain Canadian goods, and Canada responded with counter-tariffs on U.S. goods. But the exemption for Campobello still stands.

Apart from a few exceptions, Campobello commercial operators obtain their supplies from the New Brunswick mainland via ferry or bonded transport through Maine, paying the same prices as others in New Brunswick. Some materials and appliances are delivered to the island by Maine suppliers, exempt from Maine sales tax but taxed upon delivery into Canada. The Canada Border Services Agency (CBSA) officers routinely process these deliveries, and it seems to work well for all involved.

On September 8, the day the latest round of counter‑tariffs was imposed by Canada, a Campobello contractor took delivery of a truckload of building materials from Hammond Lumber in Machias. Hammond routinely delivers materials to islanders on Tuesdays and Thursdays. The buyers meet the truck at the border, pay any duties and taxes, and the truck then delivers to the job site. On this day, the large quantity of materials and the complex new rules conspired to create a major bureaucratic headache. However, the CBSA officer, calmly and pleasantly, worked through the entire list, ensuring that only the absolutely necessary fees were paid, according to sources who did not want to be named. While it kept the driver at the border for three hours, it worked out well in the end.

The same day, a seasonal resident, upon declaring a quantity of hardware purchased at Lubec Hardware, was told that "today is education day" by the CBSA officer on duty on Campobello. This was followed by a brief tutorial on what would happen if he brought similar goods across again, before he was waved though without any tariffs being assessed.

Restaurant operators, innkeepers and others surveyed, who did not want their names used, all had little of consequence to say about the situation, although they clearly do not like the increased tension between the countries nor the overall impact on prices generally.

The only real exception to the equanimity displayed by the islanders regarding the trade war would be the proprietors of Mother Mushroom, the tiny brewery established last year in Wilson's Beach. Zoltan Szoges, or Zoltan Fox as he now prefers to be known, and his partner Laura have been much in the news of late after they announced that the tariffs were forcing them to move to Lubec. This announcement, when aired on a CBC interview, resulted in considerable negative feedback to the Foxes, ultimately resulting in them rethinking their plan and of "selling off what stock we have left, seeking employment outside of this community and will evaluate options for moving forward."

The Trump administration imposed a 50% tariff on Canadian beer that will change to a total import ban on September 29. Aluminum cans imported from the U.S. now also face a 50% tariff. In response, Canadian brewers are shifting to aluminum can suppliers in China. But small breweries will certainly suffer.

A spokesperson for the Canada Border Services Agency (CBSA) states, "Purchased goods that are imported into Canada from the United States at a port of entry on Campobello Island, New Brunswick, will be exempt from the United States Surtax Order (2026) and United States Surtax Order (Steel and Aluminum 2025) and will not be subject to tariffs as long as they are imported by a person who ordinarily resides on Campobello Island and is returning after an absence from Canada of less than 24 hours, in the person's possession or form part of their baggage, for personal or household use." The countervailing taxes apply only to goods of U.S. origin.

Between 40% and 60% of Maine lobster is trucked into Canada for processing. Canada initially announced a 25% tariff on U.S. seafood, to take effect on September 8. This would have seriously hurt businesses on both sides of the border. However, it was repealed before being enacted, thus removing a potential point of serious friction for the region. But to make up for the lost revenue, Canada imposed 50% levies on copper wire, wood and charcoal, am