Posted on January 27, 2015

How a National Tariff on Rebar Impacts Your Bottom Line

Jim Bogusz, COO of Beedie Development Group, joined BC’s Minister of International Trade on January 27 to condemn the federal government’s decision to impose a tariff on a construction material called rebar. Jim outlined how it will impact everyone in British Columbia. Below is his statement.

I'm here on behalf of the developers and builders in our province and also the millions of people in BC who are dependent on what our industry creates. I'm here to speak about the direct impact this national tariff has on BC.

Rebar is integral to all construction in BC. It's everywhere and in everything, from single family homes, to condominiums, office towers and commercial buildings. It's a material expenditure in construction and the finished cost of a structure.

From BC's perspective, what is proposed isn't a tariff on imported product; it's a tax on all new concrete construction. It's unwarranted and unnecessary and increases the cost of living and doing business in BC.

There's a ripple effect to this and here are some of the consequences:

- Costs of new homes will go up. We calculate that the cost of a typical condo in the city will increase by approximately $3,500 to $10,000 per door.

- The cost of doing business in BC will increase as rents must be raised to cover increased construction costs for commercial and industrial buildings.

- We estimate that the cost of building a typical warehouse will increase by 80 cents to $1.30 per square foot. In a market where decisions are made over a matter of dimes and quarters, BC stands to lose competitive ground to other provinces.

- To BC, this tariff isn't a leveling of the playing field to protect jobs. In its most direct form, this tariff makes the cost of housing and business less affordable.

- It will hurt construction and opportunities for families and youth.

- The tariff will mean a less robust and competitive BC, with no offsetting gains for the country as a whole.