Canadian tax move could backfire

A Canadian government decision to revoke an export tax on softwood lumber sold to the US may lead to cuts in stumpage rates levied on Canadian timber producers.

The controversial 15% tax on softwood lumber exports to the US was lifted at the beginning of October following a Canadian decision that the tax is no longer warranted.

The tax was originally introduced in 1986 to compensate for Canadian provinces selling lumber to Canadian producers at what the Americans believed to be were below market prices.

The prospect of lower stumpage and more Canadian lu