THE WHAT? New 50% tariffs on cosmetics traded between the US and Canada are threatening to increase costs across the North American beauty industry, with major companies including L’Oréal and The Estée Lauder Companies exposed through Canadian manufacturing operations.

THE DETAILS The US has imposed a 50% tariff on hundreds of Canadian products, including cosmetics, while Canada has announced retaliatory 50% tariffs on certain US makeup imports from September 8. Canada was the second-largest source of US beauty and skincare imports after South Korea in 2025, supplying more than US$1 billion of products, and the highly integrated cross-border manufacturing network includes businesses and brands such as L’Oréal, M·A·C and The Ordinary. Companies could absorb some of the additional costs, increase prices, restructure distribution or shift manufacturing, but industry representatives warn that adapting established supply chains will be costly and disruptive.

THE WHY? The tariffs could fundamentally alter the economics of North American beauty manufacturing and distribution, placing particular pressure on affordable products where brands have less room to absorb a 50% duty without undermining margins or passing costs on to consumers.

Source: Bloomberg

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Source: Global Cosmetics News (https://www.globalcosmeticsnews.com/)

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