Like other Canadians, dentists are grappling with uncertainty as the Trump administration plans to impose a 25 per cent tariff on Canadian imports, effective April 2, following the previously enacted 10 per cent tariffs on Chinese-origin goods.
Clifford Sosnow, chair of Fasken’s International Trade and Investment Group, said during a webinar hosted Tuesday by the Dental Industry Association of Canada (DIAC) and the Canadian Dental Association (CDA) that dentists are ‘most vulnerable’ as the ‘end result’ of the supply chain, where costs are passed on to them.
“We’re likely to see both an inflationary impact on the cost of supplies and goods sold, and a recessionary impact on the Canadian economy,” Sosnow said. “As a result of those higher business costs and the general recessionary environment in your industry, as we’re seeing in other sectors, there will likely be less discretionary spending.”
[Also, read: Tariffs – What to do as a dental professional in Canada?]
Less discretionary spending means fewer visits to orthodontists, for example, or fewer visits to dentists for services not covered by insurance.
“Think about crowns. Think about root canals. There’s a general dampening in the demand for dental services, even while the costs for supplies, materials, and implements, and if you’re a manufacturer, for producing them, increase. An increase in cost and a decrease in demand ultimately has a deflationary impact.”
Sosnow urged dentists to review their contracts and negotiate provisions to share surtax costs with suppliers, among other tips, which will be covered in an upcoming report.
“Higher dental costs result in fewer patients seeking care.” U.S. dental groups.
Patients already have issues
While some patients on both sides of the border are already struggling with access to dental care, three U.S. dental groups urged President Donald Trump in early March to exclude dental products from the tariffs.
The American Dental Association (ADA), the Dental Trade Alliance, and the National Association of Dental Laboratories sent a letter on March 4, noting that raw materials, tools, and equipment have already been affected by the 10 per cent tariffs on Chinese-origin goods, while Canadian and Mexican imports could face 25 per cent tariffs.
“These increased costs will negatively impact oral health in the U.S.,” the letter states. “Higher dental costs result in fewer patients seeking care. Patients, already facing rising healthcare costs for non-tariff reasons, will ultimately experience greater out-of-pocket expenses as additional duties drive up the cost of dental equipment and materials.”
Manufacturers can last more than a year
Meanwhile, a new survey shows that about half of domestic manufacturers believe they can weather a trade war lasting more than a year.
A poll by KPMG Canada found that 54 per cent of surveyed manufacturers believe they can withstand a tariff war with the U.S. that lasts over a year. This compares with 67 per cent of businesses in all industry sectors.
The report also says 86 per cent of Canadian manufacturing leaders believe Canada should reduce its reliance on the U.S. It also found that 76 per cent of domestic manufacturers say expanding their customer base within Canada is vital to their survival.
The survey, conducted between Feb. 13 and Feb. 28, involved 602 Canadian business leaders, including 154 CEOs in the manufacturing industry.
“We are neighbours who are allies, we’re friends, and I want to keep it that way.”U.S. Democratic Senator Peter Welch, from Vermont.
Business representatives meet
A group of about two dozen business representatives from sectors including manufacturing, agriculture, and tourism stressed the close economic and cultural ties between Vermont and Quebec during a meeting Tuesday at a restaurant overlooking frozen Lake Memphremagog, which spans both countries, the Canadian Press reported.
A Vermont-based brewery representative said a drop in visitors from Canada is hurting revenue, while tariffs are driving up costs for items like aluminum cans.
Bob Montgomery, of Hill Farmstead Brewery, said the business had become so attached to its northern neighbours that it held a special “Quebec Day” in 2021 to celebrate the border reopening after the COVID-19 pandemic. However, those customers are now turning away.
“Bottom line, these tariffs are making it more expensive to do business, reducing customer spending and loyalty, and putting Vermont small businesses at massive risk,” Montgomery said.
U.S. Democratic Senator Peter Welch, from Vermont, attended the meeting and expressed his concerns.
“We are neighbours who are allies, we’re friends, and I want to keep it that way,” Welch said.
(With files from the Canadian Press)