By Eric Boehm | Reason
Amid surging lumber prices that are already adding an average of $36,000 to the construction cost of new homes, the Biden administration is moving forward with plans to double tariffs on lumber imported from Canada.
The Commerce Department announced on Friday that it was taking the first step toward hiking so-called “anti-dumping tariffs” on Canadian lumber from an average rate of 8.99 percent in 2018 to 18.32 percent for 2019. Yes, 2019. If approved through what is likely to be a lengthy review process, the tariffs would apply retroactively to purchases made for the past two years. That means American importers could be on the hook for millions of dollars in taxes they didn’t even know they would owe—taxes that will likely be passed down the supply chain in the form of higher prices.
That’s only the first bit of insanity here. Anti-dumping tariffs, in theory, are meant to cancel out what’s seen as unfair subsidies for foreign competitors to American companies. They are supposed to be deployed in order to prevent import prices from becoming so low that they threaten domestic producers—even though there’s really nothing terrible about low prices for imports.