Mar 5, 2019

A new Canadian House of Commons International Trade Committee report finds that retaliatory tariffs are taking a toll on Canada’s economy and calls on the government to work with the U.S. on resolving the issue. The study – titled “Section 232 of the United States Trade Expansion Act: Implications of Tariffs for Canada” – includes specific mentions of the recreational boating industry’s hardships from aluminum and steel tariffs and subsequent retaliation measures – a key win for the industry, which NMMA Canada and the Provincial Marine Trade Associations helped secure through written submissions and advocacy efforts. The Canadian government now has 60 days to respond to the committee’s report.

Specific mentions of NMMA Canada’s submissions in the report:

• Among others, National Marine Manufacturers’ Association Canada and R & R Reinforcing Ltd., which submitted briefs to the Committee, suggested that Canada’s surtaxes might lead, or have led, to reduced sales – pg. 15

• Among others, National Marine Manufacturers Association Canada and Rapid-Span Group of Companies said that, if they have not already done so, Canada’s surtaxes will reduce or delay investments in Canadian operations or might cause job losses – pg. 15

• National Marine Manufacturers’ Association Canada, Patriot Forge Co., the Rapid-Span Group of Companies and Riverview Steel Co. Ltd., were among the witnesses indicating that some of Canada’s firms might close or relocate their operations as a result of Canada’s surtaxes – pg. 15 

• National Marine Manufacturers’ Association Canada suggested that Canada’s surtaxes are being applied on certain U.S. products that are unavailable from domestic sources – pg. 16/17

• The joint brief submitted to the Committee by the Association Maritime du Québec, the Atlantic Marine Trades Association, the Boating BC Association, Boating Ontario, the Mid-Canada Marine Dealers Association and the National Marine Manufacturers’ Association Canada remarked that Canada’s manufacturers cannot provide the country’s recreational boat dealers with the recreational boats that are imported from the United States and on which they are paying Canada’s surtaxes. – pg. 17

• The National Marine Manufacturers’ Association Canada suggested that the Government of Canada should not apply the country’s surtaxes on recreational boats – pg. 19

Five key recommendations from the report:

• Recommendation 1 That the Government of Canada, on a priority basis, intensify its discussions with the Government of the United States regarding the tariffs that are being applied on certain Canadian steel and aluminum products pursuant to section 232 of the Trade Expansion Act of 1962. The Government should seek an outcome in which bilateral trade in steel and aluminum products is not limited by tariffs, quotas or other trade restrictions. Until that time, the Government of Canada should continue to consult with Canadian stakeholders on potential actions and support measures that would increase protections for Canadian workers, firms and jobs.

• Recommendation 2 That the Government of Canada review the application processes for surtax remissions, as well as the duty drawback and duties relief programs, to ensure that they are user-friendly and timely. As well, the Government should undertake further efforts to share information with small and medium-sized enterprises about available supports, including the remissions of surtaxes that have been applied on certain U.S. products since 1 July 2018, duty drawbacks and duties relief in relation to those surtaxes.

• Recommendation 3 That the Government of Canada ensure that the measures that were announced on 29 June 2018 in response to the U.S. tariffs that are being applied on certain Canadian steel and aluminum products pursuant to section 232 of the Trade Expansion Act of 1962 are available to more of Canada’s steel, aluminum and related firms, regardless of their size, and to affected workers. 

• Recommendation 4 That the Government of Canada, when determining the actions to be taken regarding final steel safeguards, make efforts to balance the needs of Canada’s firms that produce steel products with the needs of domestic firms that use these products as production inputs.

• Recommendation 5 That the Government of Canada engage in ongoing discussions with the Government of the United States regarding the United States’ current and potential use of section 232 of the Trade Expansion Act of 1962 to apply tariffs on Canadian products. During those discussions, the Government should emphasize the scope, depth and strategic importance of the two countries’ trade relationship, and the need to exempt Canadian products from any U.S. trade restrictions.

If you have questions, please contact NMMA Canada president, Sara Anghel at sanghel@nmma.org

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