Paul MacKay, manager of King’s Co-op Bookstore in Halifax, with some of the books in his store on Feb. 14.Ingrid Bulmer/The Globe and Mail
When Paul MacKay, the manager of King’s Co-op Bookstore in Halifax, wanted to illustrate the unexpected consequences of applying countertariffs on books coming into Canada, he found the perfect example in Prime Minister Mark Carney.
The latest edition he had of Mr. Carney’s 2021 book Values: Building a Better World for All was printed in the United States. So, if Ottawa were to go forward with countertariffs on books – which it is considering for its next round of retaliatory measures to U.S. tariff threats – even one by Canada’s top politician would be subject to 25-per-cent charges.
The complex supply chain that carries books from publishing houses to Canadians’ shelves often requires them to be printed or warehoused in the United States – especially among the major multinational publishers, which account for the vast majority of books sold in Canada. Mr. Carney’s book, for instance, was published by Penguin Random House Canada’s Signal imprint. It’s one of potentially thousands of books written by Canadian authors and published by a Canadian house that is still made in the United States, and could therefore be susceptible to countertariffs.
This dynamic both complicates the easy sloganeering of “Buy Canadian” and, should countertariffs be imposed on U.S.-printed books, could threaten the well-being of independent bookstores, which already face thin margins and steep competition from much larger retailers Indigo and Amazon, the latter of which also has capacity to print books on demand in Canada.
And unlike, say, swapping a bottle of California wine for a Niagara one, readers tend to seek out specific titles – meaning books aren’t really the kind of fungible product that could be easily switched out. When someone wants to read the second book in The Hunger Games series, for example, they’re not likely to pass over it for a different novel.
Readers who want to seize the moment by buying a Margaret Atwood novel or a non-fiction book by Ken Dryden may find themselves looking for books printed in the United States. If Ottawa implements countertariffs on books, consumers could find themselves paying more at some stores for Canadian authors.
“People will have no way of knowing what they should be buying,” Mr. MacKay said. “This is way more complicated than people think.”
Bookstores could also be forced to either absorb major price increases, leaving less revenue for overhead costs, or pass the increases onto consumers. Those readers could easily seek cheaper books online, such as through Amazon, which could more easily handle price increases because of its massive scale.
“The difference this will make to Americans will be negligible at best,” Mr. MacKay said in an interview after posting about the Mr. Carney book conundrum on social media. While countertariffs might be helpful in a trade war, even if Canada wins, putting them on books could mean ”the entire Canadian publishing and bookselling industry will be extinct,” he added.
The average margin that King’s Co-op might make on a book is 40 per cent, which proposed tariffs could reduce to 15 per cent. “That’s just not sustainable once you take rent alone into concern,” Mr. MacKay says.
Worries about countermeasures began surging across the bookselling sector this past week, after the point-of-sale provider Bookmanager sent an e-mail to its hundreds of Canadian clients on Tuesday titled ”Urgent: Is the Canadian Retail Book Industry About to Implode?” It warned that books, which had not previously been on countertariff lists, were now under consideration ahead of the latest April 2 tariff deadline, pending industry consultations.
In his e-mail, Bookmanager president Michael Neill gamed out the mathematical possibilities of different players in the sector absorbing increased costs from countertariffs, finding none of them sustainable.
“I’m hoping that this hasn’t been thought through,” Mr. Neill, who also owns Mosaic Books in Kelowna, B.C., said in an interview. “There’s been so much going on that maybe somebody didn’t think about it for more than a minute.”
The Department of Finance is in the midst of determining which goods to include in its upcoming $125-billion countertariff list. A spokesperson declined to comment on the potential consequences of such tariffs on Canadian bookselling and publishing, instead saying the government welcomes industry feedback through a web form.
Numerous book-related industry groups and companies, including the Canadian Independent Bookstore Association, the Association of Canadian Publishers and Indigo have been pressing the Finance department more directly with their concerns, sending urgent letters and seeking meetings with senior officials.
When it comes to President Donald Trump’s will-he-or-won’t-he tariff threats against Canadian goods exported to the U.S., independent Canadian publishers have been pinning their hopes on a exemption for “informational materials” buried deep in American emergency legislation.
Because of this, industry groups are warning that putting countertariffs on books isn’t truly retaliatory, and could risk the U.S. removing its exemption, says Jack Illingworth, executive director of the Association of Canadian Publishers. Meanwhile, Canada has long included cultural exemptions in trade agreements, and he argues that dragging books into a trade war could set a bad precedent for future negotiations.
In a joint letter to the Prime Minister on Thursday, Laura Carter, executive director of the Canadian Independent Booksellers Association, alongside Indigo chief executive Heather Reisman, warned that the nature of books is different than many other consumer goods.
Because consumers seek out specific titles, “we know that readers will not likely substitute a book arriving via the U.S. for a Canadian printed and warehoused book,” Ms. Carter and Ms. Reisman wrote. “At this time there is nowhere near the capacity in Canada to handle all of our printing and warehousing.”
In an e-mail, Ms. Carter said tariffs on U.S.-printed books would “be devastating for independent bookstores and a serious threat to their survival.”
