Politics

Federal government rolls back retaliatory tariffs on boats from U.S.

The Liberal government is lifting the retaliatory tariffs it imposed on boats imported from the United States — a move that is being welcomed by Canada's recreational boating industry.
The federal government has decided to roll back 10 per cent tariffs imposed on boats made in the U.S. During the ten-month tariff regime, sales at boat shows in Ontario were down by as much as 25 per cent, according to the Ontario Boating Association. (Terry Mertz)

The Liberal government is lifting the retaliatory tariffs it imposed on boats imported from the United States — a move that is being welcomed by Canada's recreational boating industry.

"We are thrilled and appreciative of the federal government taking the measure to amend the tariff and remove boats from the list," said Rick Layzell, CEO of the Boating Ontario Association.

"We're pleased that the industry can get back to the work of selling and servicing and taking care of customers' need for recreational boats."

On June 1 last year, the United States Department of Commerce imposed tariffs of 25 per cent on Canadian steel and 10 per cent on aluminum, citing national security interests.

Canada responded with its own tariffs of 25 per cent on steel and 10 per cent on aluminum, but also slapped a 10 per cent tariff on a long list of consumer items meant to target U.S. politicians in states where those products are made.

That product list included Kentucky bourbon, lawnmowers, ketchup, maple syrup, appliances, boats and many other items. The federal government said it was targeting goods that Canadians could otherwise buy from domestic suppliers.

"Over 90 per cent of the boats that we sell in this country come from the United States," said Layzell. "You cannot simply flip a switch and source boats from Canada. We don't have the manufacturing infrastructure anymore.

"The impact has been quite severe on our industry. What we saw was a mindset of apathy from consumers at boat shows over the winter months."

Canada imposed tariffs of 10 per cent on an array of U.S. goods, including Kentucky bourbon, that took effect July 1, 2018. (liquor.com)

Lazyell said that he does not have the sales numbers for the past year yet but sales at boat shows were down by 25 per cent over previous years this winter. The expectation was, he said, that the first year under the tariff regime would see sales of boats in Canada decline by 30 per cent.

According to the Boating Ontario Association, the boating industry in Canada generates more than $10 billion in revenue annually, with 40 per cent of that coming from Ontario. The association says that the industry employs 75,000 people in Canada and that six out of ten boat owners have a household income of less than $100,000.

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