Representatives from the countries have negotiated for several days but have failed to reach an agreement.
The announcement means that tariffs of 50 percent will be imposed on a large number of Canadian goods starting at 6:01 a.m. on Saturday, Swedish time.
The US blames Canada.
Last night, Canada refused to complete the trade deal under the terms agreed upon earlier this week, US Trade Representative Jamieson Greer told reporters.
Canadian Prime Minister Mark Carney says the country will impose retaliatory tariffs equivalent to what he describes as "dollar for dollar."
"The last-minute changes to the terms proposed by the United States were unfair, uneconomical and called into question the reliability of an agreement," Carney said in a statement.
