Trump’s Canadian tariffs are having a chilling effect on Vermont’s small business owners

President Donald Trump’s recent tariff threats against Canada have already started to impact small businesses in Vermont. One such business feeling the effects is Caledonia Spirits, based in Montpelier, VT. Ryan Christiansen, the president and head distiller at Caledonia Spirits, revealed that a shipment of spirits ordered by the Société des alcools du Québec has been sitting on a shipping dock for a month. The order was canceled shortly after Trump announced tariffs against Canada in February. This has resulted in financial setbacks for Caledonia Spirits, as the order was expected to boost sales during a slow season.

Vermont has strong business ties with Canada, with annual exports totaling $680 million and imports exceeding $2.6 billion. The imposition of tariffs by both countries has led to disruptions in trade, affecting small businesses in Vermont. Ontario’s decision to remove American alcohol products from its shelves further complicates the situation for businesses like Caledonia Spirits.

The impact of tariff rhetoric is not limited to the business sector. Tourism in Vermont, particularly in areas close to the Canadian border, is also feeling the strain. Steve Wright, president and general manager of Jay Peak Resort, noted a decline in spending from Canadian tourists during key weeks in March. Canadian visitors make up a significant portion of the resort’s market, especially during peak vacation periods.

The reduction in hours of operation at the North Troy border crossing has added to the challenges faced by businesses like Jay Peak Resort. To mitigate the effects of tariffs and border restrictions, the resort has been offering at-par options for Canadian tourists on select products. However, there is concern that continued trade tensions could deter Canadian visitors from frequenting Vermont businesses.

In response to the uncertain economic climate, small businesses in Montpelier are exploring proactive measures to maintain tourist traffic. Bill Butler, co-owner of Artisans Hand Craft Gallery, is proposing promotional deals for Canadian visitors to encourage foot traffic in the city. Initiatives like “Canada Days” aim to attract Canadian tourists with special offers and discounts, emphasizing the strong relationship between Vermont and Canada.

The price of imported goods is another area of concern for businesses in Vermont. Sam Guy, owner of Guy’s Farm & Yard, is wary of the impact of tariffs on products sourced from Canada. Wood shavings, wood pellets, peat moss, and animal feed ingredients are among the goods that could see price increases due to tariffs. Passing on these additional costs to customers may pose challenges for businesses operating on low margins.

Overall, the ongoing trade tensions between the US and Canada are creating uncertainty for small businesses in Vermont. As they navigate the impact of tariffs on trade and tourism, businesses are exploring innovative solutions to maintain relationships with Canadian customers and sustain their operations in the face of economic challenges.