\nThe Appellate Body has reversed a panel’s finding that any import charge offsetting an internal tax need only “serve the same function” as the internal tax and need not be equivalent in amount to that internal tax, US Trade Representative (USTR) Susan C. Schwab announced on Thursday.
\nIndia imposed extra duties on US imports in addition to and on top of its basic customs duty, resulting in combined duties on imports of alcoholic beverages (beer, wine and spirits) of up to 550 %.
\nIndia argued that the duties were permitted because they simply offset certain internal taxes (such as value-added taxes).
\nIn reversing the panel, the Appellate Body agreed with the US that any import charges aimed at offsetting internal taxes cannot result in a higher amount being charged to imports than to like domestic products.
\n“This is an important decision for all WTO members, particularly at a time when they are negotiating tariff commitments,” Schwab said.
\n“The Appellate Body reversed a deeply flawed panel report and reaffirmed a fundamental WTO rule that Members cannot impose duties on imports that exceed their tariff commitments.”
\nIn response to US concerns, during the dispute settlement proceedings, India announced it was withdrawing the additional duty on alcoholic beverages and modifying the extra-additional duty to provide a refund mechanism. This, it represented to the panel eliminated any discrimination against US imports.<\/p>\n","protected":false},"excerpt":{"rendered":"