The trade war between the US and Canada has escalated again after Canadian leaders outlined a major retaliation against US President Donald Trump's latest wave of tariffs.Canada pledged to impose tariffs between 15 and 50 per cent on US imports worth about $US20 billion ($28 billion).The tariffs, which take effect from September 8, will affect about 700 product types. Those hit with the highest tariffs include smartphones, cosmetics, milk, furniture and paper. Tariffs of 25 per cent will be placed on seafood, appliances, cheeses, carpets and textiles.It represents a further deterioration in relations between the North American neighbours.Mr Trump labelled Canada the "most difficult and unreasonable" country he has dealt with. But Canada is digging in as a rare ally prepared to forcefully push back on his protectionist trade policies and hardball negotiating tactics.Mr Trump announced new tariffs on many Canadian goods after negotiations over a new trade agreement fell apart last week. Canada said the US had been trying to impose unfair terms that would have harmed Canadian industry and workers."This is an unprecedented challenge imposed on Canada," Canadian Finance Minister Francois-Philippe Champagne said today. "But Canada will meet the moment."Some Canadian leaders have threatened further measures. Earlier this week, Ontario Premier Doug Ford said other options included ending US access to the province's critical minerals or placing new fees on Canadian power provided to northern US states."We power 1.5 million homes and businesses," Mr Ford told the Associated Press. "Everything's on the table. I'll do whatever it takes."Mr Ford and Mr Trump had been indirectly trading insults after the talks broke down.Mr Trump called Mr Ford and Canadian Prime Minister Mark Carney "clowns" who should "fall in line" or face "far worse" consequences than the tariffs. Mr Ford called Mr Trump a "bully", a "dictator", and the "king of bankruptcies"."Things got a little heated," Mr Ford later told CNN. "I want to make a deal. A good deal for the American people, a good deal for the Canadians."Before Canada's tariff announcement, Mr Trump published a series of social media posts criticising Canada, accusing the country of "ripping off" the US for decades and driving American companies out of business.He also disputed Mr Carney's suggestion that US trade negotiators had pressured Canada to weaken French language protections. "This lie was made up by a weak and ineffective Prime Minister," Mr Trump wrote.He went on to threaten to change the name of Lake Ontario, which straddles the US-Canada border, to "Lake America"."I deal with many countries, and Canada is easily the most difficult and unreasonable," he wrote. "They feel entitled, but they are not a State, and will be entitled no longer!"Canada also announced a multi-billion-dollar support package for Canadian businesses affected by the tariffs. It includes business loan and financing programs.