- The U.S. government recently imposed crippling new taxes on uncoated groundwood paper, the source of newsprint for newspapers, book publishers and other commercial printers. These unjustified taxes threaten American newspapers, printers, and the American pulp and paper industry, putting tens of thousands of jobs at risk and harming the small and rural communities across the country that rely on local, printed newspapers.
- The preliminary countervailing and antidumping duties range as high as 32 percent. These tariffs are being collected now at the border and as a result, newspapers and printers have experienced increases in production costs by roughly 30 percent. Many newspapers are considering laying off workers and reducing the amount of news and information that is published. Small market and rural newspapers are having a difficult time finding enough newsprint to continue operations altogether.
- These tariffs were sought by one small paper mill, Northern Pacific Company (NORPAC), which is owned by private equity firm, One Rock Capital Partners, which counts the Mitsubishi Corporation as a major partner. NORPAC’s complaint fails to demonstrate that the U.S. industry is being harmed by imports from Canada.
- First, about 90 percent of groundwood paper from Canada is delivered to the Midwest and Northeastern United States, not the northwest region served by NORPAC.
- Second, to the extent that NORPAC is experiencing declining sales, so is the rest of the industry because of the decades long shift from paper to digital. Throughout the industry, demand for newsprint in North America has declined by 75 percent since 2000.
- Despite the shift to digital, the distribution of print newspapers is critically important to small town and rural America where the newspaper keeps the community connected with one another, particularly with the absence of broadband. With price increases as high as 30 percent, some small market and rural newspapers may have to shut their doors. This will be damaging to local communities across the country – and also threatens our democracy.
Paul Boyle is the Senior Vice President of Public Policy at News Media Alliance.