Jersey businesses say tariffs hurt; legislators weigh relief

TRENTON — New Jersey businesses say steel and aluminum tariffs imposed by President Donald Trump's administration are beginning to pinch, and lawmakers are pushing measures to ease the pain.
Executives from a handful of businesses told the Legislature's bipartisan manufacturers caucus this week at a field hearing in Metuchen that the March tariffs are confronting them with higher costs and the prospects of going beyond the U.S. to get raw materials.
Some lawmakers are pushing for state legislation that would give tax credits to lessen the impact of the tariffs, but the proposal so far hasn't advanced.
The issue is coming to the fore after the Trump administration and China imposed tens of billions of dollars of duties on each other's goods.
Until the president restored the tariffs as part of his self-described America First policy, such duties were largely a holdover from the 19th and 20th centuries, when countries imposed them to raise revenues and protect domestic industry from foreign competition.
Trump has said he is revising tariffs to push back against China's aggressive industrial policies.
Gary DuBoff, the chief executive of Arrow Fasteners, which makes staples, told legislators that his company can't pass along the cost of higher materials to customers because his firm's competitors are not subject to the same tariffs.
``We're stuck,'' he said.
Marcia Frieze, the CEO of Case Medical, which manufactures medical instruments and containers, said her company can ``swallow'' some of the increased costs from the tariffs, but the problem is that there isn't enough U.S.-based supply for her company to use as raw materials.
``I cannot get the material we need manufactured here in the U.S.A.,'' she said.
Manufacturing accounts for about 6 percent of New Jersey's nonfarm jobs, according to the federal Bureau of Labor Statistics, compared with nearly 9 percent for the nation overall.
Economists say tariffs could give producers room to raise prices, which helps them, but hurts consumers and the companies that rely on imported products.
In New Jersey, lawmakers say the tariffs are carrying ``unintended consequences'' of hurting _ instead of helping _ businesses.
Republican Sen. Tony Bucco introduced legislation in June to give tax credits to businesses that purchase steel and aluminum. Bucco's bill said the credits are intended to offset the effect of a 25 percent steel tariff and a 10 percent aluminum duty.
The bill allows a credit against the income tax and the business tax equal to 25 percent of the amount paid the purchase of steel or 10 percent of the amount paid by the taxpayer for the purchase of aluminum.
The effect of the legislation on the state budget isn't clear.
Democratic state Sen. Vin Gopal called it a good bill and said he would push it in the Democrat-led Legislature. The state cannot afford to lose manufacturers, he said.
``We have to ensure our manufacturers do not fall victim to these imprudent and dangerous tariffs,'' he added.
The New Jersey Business and Industry Association asked its members whether tariffs will result in higher prices for consumers, according to spokesman Bob Considine, and nearly two-thirds said yes.
Still, he added, many of the trade organization's members say they support the duties to counter ``unfair'' trade practices facing the country.