The Trump administration is taking retaliatory action against Canada over a trade dispute, moving to impose a 20% tariff on softwood lumber that is typically used to build single-family homes.
In an interview Monday, Commerce Secretary Wilbur Ross said the tariff will be applied retroactively and imposed on Canadian exports to the U.S. of about $5 billion a year. He said the dispute centers on Canadian provinces that have been allegedly allowing loggers to cut down trees at reduced rates and sell them at low prices.
The determination that Canada improperly subsidizes its exports is preliminary, and the Commerce Department will need to make a final decision. In addition, the U.S. International Trade Commission will need to find that the U.S. industry has suffered injury. But even a preliminary decision has immediate real-world consequences, by discouraging importers from buying lumber from Canada.
“We tried to negotiate a settlement but we were unable,” Ross said, adding that previous administrations have also been unsuccessful in resolving the dispute.
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