The $6 trillion budget proposal from the Biden administration has to come from somewhere. Recent reporting suggests that the White House is set to heavily tariff imports on lumber.
According to Reason, the Biden administration’s Commerce Department might retroactively hike up “anti-dumping tariffs” for American importers of Canadian lumber from their 8.99% rate in 2018 to a whopping 18.32% for 2019.
Since it’s the year 2021, those companies are going to have to pay up back-taxes on lumber. According to the Cato Institute, the US government can actually do that.
“Importers will also be forced to increase their cash deposits on imports now coming in (in line with the higher rate), but they won’t know for years — when Commerce finishes its 2021 review — if they owe U.S. Customs more or less in final duties. All of this creates even more financial uncertainty for importers, further discouraging them (especially smaller ones) from importing lumber from Canada.”
CNN is begging the Biden administration to do the opposite, by saying that the President should lift Trump-era tariffs.
What this means is an impact on the housing market. While the housing market is “wild” right now, a spike in lumber prices means it’s more difficult to build a home. CNBC as of the end of April 2021 said the lumber price factor added $36,000 onto the cost of construction.
FYI pic.twitter.com/e8ZVruPX71
— Brian Nichols (@BNicholsLiberty) June 2, 2021
The National Association of Home Builders isn't thrilled about the prospects. Chairman Chuck Fowke had this to say about the White House.
“Lumber prices are already up more than 300 percent from a year ago. If the administration’s decision to double tariffs is allowed to go into effect, it will further exacerbate the nation’s housing affordability crisis, put even more upward pressure on the price of lumber and force millions of U.S. home buyers and lumber consumers to foot the bill for this ill-conceived protectionist action.”
As previously reported, a reflection on the Biden administration’s decision-making in recent months projects a grim indication of what to expect going forward.
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