Local Lumber Yards Confused Over Tax Controversy

New Tariff on Canadian Soft Timber is Lower than Pre-2015 Levels

SUPERIOR, Wis. – Earlier this week, the Trump Administration sparked controversy when the President announced a new import tax on Canadian soft timber.

President Trump unveiled a new tax of up to 24 percent on imported Canadian soft timber, claiming Canada’s lumber industry is government subsidized.

Canadian leaders deny those claims, and say they’re prepared to fight what they call an unfair tariff.

“Our action plan on softwood starts with fighting the unfounded claims of the U.S. lumber production lobby and the unwarranted and unfair duties placed on Canadian lumber products,” said Christy Clark, Premier of British Columbia.  “We will only accept an agreement with the United States that’s good and that is fair for BC workers. We will fight and we will win.”

Meanwhile, many local businesses, like Manion’s Wholesale Building Supplies in Superior, buy from the affected Canadian mills.  Representatives say Canadian soft timber has been taxed for the last 30 years, with a one year “cooling off process”, starting in October 2015.  The new tax rates, are actually lower than pre-2015 levels.

“The average is 19.88 percent,” said Bill Hesselgrave of Manion’s.  “I believe the last tariff we had was around 27 percent. It really comes down to the logs, if they’re getting subsidized for the logs, what the U.S. is charging for their logs.  The outrage really shouldn’t be there as much, it’s not new.”

Hesselgrave added he didn’t expect sales to slip because of the tariff, saying lumber is very much a supply and demand industry.  And with new home construction at its highest rate since 2006, demand is there.

The tariff could change, as the United States, Canada and Mexico renegotiate the North American Free Trade Agreement (NAFTA).