The new tariff ranges as high as 276% significantly adding to the cost of building construction.
Joe Formosa owns Muchalat Construction in Cumberland and he has literally been stockpiling drywall in order avoid a Federal government imposed tariff on drywall imported from the U.S.
“We started stockpiling on Monday. We have been trying to buy enough to protect our ongoing customers right now” Formosa told CHEK News.
The Canadian government imposed the new tariffs last week, ranging up to 276% in order to protect Canadian producers after American ones were accused of dumping on the Canadian market.
The problem for contractors in BC is that there is only one Canadian producer in the west and it can only meet about half of the demand.
That is why so many contractors and suppliers in BC have always purchased drywall from the US.
The Tariff means contractors here are paying over 40% more.
“So that’s affecting our contractors today. Basically with very little notice and they’re in the middle of contracts, they’re in the middle of jobs whether it’s a house or a huge condo building or a commercial job they’re going to be charged this extra fee” said Britt Lawrence, General Manager of the Slegg Lumber in Cumberland.
Slegg management says they have no choice but to pass on the extra fees to their customers.
“We can not afford to take on these costs ourselves, it has to be passed on to the end user and that’s the customer with no notice” added Lawrence.
And Joe Formosa is one of those customers who says in turn he has no choice but to pass the extra cost on to his.
“We hate to do that because it affects out customers but I don’t think anyone’s going to have any choice. I just can’t see this continuing” said Formosa.
The Independent Contractors and Business Association of BC estimates the new tariff could add upwards of $3000 to the cost of a new home.
The Canadian Government says it will reassess the new tariff in December.