The Canada Border Services Agency (CBSA) has placed temporary tariffs on sofas and chairs coming in from China and Vietnam and are flooding the market.
In an email to Global News, the agency said an investigation is currently taking place for dumped and subsidized products arriving from both countries.
The duties against Chinese manufacturers range between 20 per cent to 295 per cent while the ones against Vietnamese manufacturers are from 17 per cent to 101 per cent.
“The CBSA has completed the preliminary stage of its investigations and found that imports of upholstered domestic seating from China and Vietnam have been dumped and subsidized,” read a statement from spokesperson Mark Stuart.
“Effective May 5, 2021, provisional duties are being imposed on these imports, in order to offset the harmful effects of the dumping and the subsidization.”
The statement also noted Canadian producers have the right to be protected from unfairly priced imported goods under the Special Import Measures Act.
The investigation was triggered by a written complaint by Canadian manufacturers.
Global News reached out to two Canadian organizations representing furniture manufacturers, but haven’t received a response.
Furniture stores across the country are concerned about the impact the levies will have on affordability for customers.
The Retail Council of Canada said many small- and medium-sized businesses in rural areas are already hurting and this is another blow.
“(They say), ‘I’m just barely surviving because of the pandemic and the different restrictions across the country and these duties are just the last nail in the coffin,’” president and CEO Diane Brisebois told Global News.
A Saskatchewan retailer said he had to get in touch with 64 customers who placed previous orders to let them know about the tariffs and that he was unable to sell the sofas and recliners at the listed price.
“They had to make a decision. Do you think even one of those customers decided to follow through on the sale? Not a chance,” Battleford Furniture’s Chris Odishaw said.
The tax could be implemented fully in the coming months.
The CBSA said final decisions regarding dumping and subsidized furniture will be made by Aug. 3.
The agency said if a final decision on keeping the tariffs is made, the Canadian International Trade Tribunal (CITT) will hold an inquiry into how severely Canadian manufacturers are being harmed.
Both Brisebois and Odishaw said wait times for Canadian manufacturers for sofas and recliner chairs are between three to nine months.
The Surrey-Newton MP is also collecting letters and petitions from businesses.
Sukh Dhaliwal’s office said he intends to raise the issue during Liberal caucus meetings this week.