After days of intense negotiations, the two countries did not reach a trade deal late on Friday, worsening a delicate relationship between the long-term trade partners and allies and complicating the future of the continental free trade pact called the US-Mexico-Canada Agreement.
Trump's new tariffs hit a slew of sectors including wine, furniture, dairy products, cement, clothing, fishing rods and hockey equipment and cover about $US20 billion ($A28 billion) of Canadian exports to the US.
These duties do not exempt Canadian products under the USMCA, which has shielded most Canadian exports to the United States in the last 18 months.
"Canada will match Washington's new tariffs dollar for dollar in order to protect Canadian workers, farmers, families and businesses," Carney said at a news conference.
Canada's tariffs will hit US sectors such as steel, dairy, appliances, agricultural equipment, pulp and paper and electronics along with some sectors the US previously targeted in Canada, Carney said from Ottawa's parliament building.
The Canadian government will release details over the next several days, Carney said.
"We cannot accept what they have offered, and we will not give what they have asked," Carney said.
Trump had expressed hope that a deal with Canada could happen on Friday.
But Carney said the US administration's last-minute demands halted progress.
"In recent days, the US proposed new terms that were uneconomic, unfair and undermined the net benefits to Canada, calling into question the reliability of any deal," he said, adding these demands included curtailing Canada's ability to forge new trade deals.
Carney said Canada would announce support measures next week for industries that are hit by the new US duties, alongside new tariffs on the US.
The new US tariffs cover about five per cent of Canada's exports to the US.
They could expose some vulnerable industries such as softwood lumber and wine to severe damage and lead to job losses and business closures, trade experts have said.
"We will be mobilising our network of businesses in all regions and all sectors to brace for impact and make the best of a bad situation," Candace Laing, CEO of the Canadian Chamber of Commerce, said.
Ontario Premier Doug Ford, one of the most vocal opponents of US tariffs, supported Carney's decision to retaliate.
"I'm glad he didn't sign that deal because it was a bad deal. It was a bad deal for Ontario. It was a bad deal for the auto sector, the steel sector and manufacturing sector," Ford told reporters on Saturday.
US Trade Representative Jamieson Greer told Fox News on Saturday that no new talks are planned with Canada.
"We're moving forward with measures that respond to Canadian retaliation," Greer said.
"They've always had the best deal, and they still would have an even better deal, but they didn't want that."
