Tag: tariff

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-Top News UK News

UK to begin talks to resolve Trump-era tariff dispute

No specific date or timeline was given for the talks but discussions will address “global steel and aluminum excess capacity, including the US’ application of tariffs” on the metals from Britain, reports Asian Lite News

The United States and Britain on Wednesday agreed to start talks aimed at resolving their trade dispute over US steel and aluminum tariffs, the countries said in a joint statement.

No specific date or timeline was given for the talks but discussions will address “global steel and aluminum excess capacity, including the United States’ application of tariffs” on the metals from Britain.

“Both parties are committed to working towards an expeditious outcome that ensures the viability of steel and aluminum industries in both markets,” the joint statement said.

They said the talks also will cover the UK’s 25% retaliatory tariffs on US products, which include whiskey, motorcycles, blue jeans and tobacco. Annual exports of US whiskey to Britain have fallen by more than half since 2018, according to the Distilled Spirits Council, which welcomed the announcement.

A spokesperson for Britain’s trade ministry said: “Until a deal is done we will continue to apply rebalancing measures on U.S. products, and won’t hesitate to take any action necessary to defend our vital steel and aluminium industries.”

The joint statement was issued after a virtual meeting between US Commerce Secretary Gina Raimondo and UK Secretary of State for International Trade Anne-Marie Trevelyan to discuss the tariffs. US Trade Representative Katherine Tai also signed onto the joint statement.

Britain is keen to negotiate duty-free access to American steel and aluminum markets similar to that granted by Washington to the European Union on Jan. 1 as part of a quota deal reached last October that took six months to negotiate.

The metals tariffs – 25% on steel and 10% on aluminum – were first imposed in March 2018 by former US President Donald Trump under the “Section 232” national security law to protect US producers from subsidized imports.

US steelmakers cautioned against the UK negotiations and similar talks with Japan leading to substantial additional volumes after a nearly 50% jump in imports last year.

“We think it is essential that the administration ensures that the various new agreements it is considering do not result in a flood of imports,” said American Iron and Steel Institute President Kevin Dempsey.

Philip Bell, who heads the Steel Manufacturers Association, said Britain’s steel production is “highly export oriented” and dominated by Chinese and Indian ownership.

“The US government should be concerned about any additional alternative arrangement that will lead to increased steel imports and support countries not committed to free and fair trade,” Bell said in a statement.

Raimondo and Trevelyan agreed to work to address global excess capacity in steel and aluminum production largely centered in China – a goal included in the US-EU agreement.

The announcement of talks coincides with a sensitive time politically for British Prime Minister Boris Johnson, whose leadership is under threat after a series of revelations about Covid lockdown breaches at his residence.

If that crisis develops into a formal leadership challenge, it could paralyze decision-making within the government for several weeks and limit ministers’ mandate to negotiate the concessions needed to reach a compromise with the United States.

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India News

Goa, Delhi Power Ministers in public face-off over tariff models

During the debate Jain said that the free 300 power units would serve as a boon to nearly 87 per cent households in Goa…reports Asian Lite News.

Goa Power Minister Nilesh Cabral and his Delhi counterpart Satyendar Jain on Monday had a much anticipated public face-off over the virtues of the power tariff structures in place in the two states.

The public debate between the two ruling politicians took place in Panaji, more than a week after Cabral challenged the Aam Aadmi Party — which is gearing up for a high visibility election campaign ahead of the 2022 polls and which has promised free 300 units of power for domestic connections, as well as uninterrupted 24×7 power supply, if the party comes to power.

During the debate Jain said that the free 300 power units would serve as a boon to nearly 87 per cent households in Goa.

“Nearly 87 per cent households consume less than 300 units of electricity. The announcement made by the AAP will benefit all these households. They will get a zero bill,” Jain said.

Cabral however contended that there are no free lunches and that if power is given free of cost or at a highly subsidised rate, then a government would invariably tax the taxpayer through other channels.

“Nothing is free in this world. Whatever they are providing for the people of Delhi is taken from the taxpayers of Delhi and besides, their government’s borrowings run into crores of rupees,” Cabral said.

The Goa Power Minister also said that private power distribution companies in the national capital were indirectly benefited by the Chief Minister Arvind Kejriwal-led government.

Cabral also said that the tariff structure in Goa was unique and the power rates in the coastal state were already low compared to the national average.

“Here, the Goa government is itself the distributor and we have kept rates low. Our power tariff, no matter how many units one uses, doesn’t go beyond Rs four per unit for the consumer. In Delhi, if you cross 200 hundred units, even after the subsidy from the government, the rate is higher than what is paid for the same number of units in Goa,” Cabral shot back.

This is the second time that tariff structures in the two states, have triggered rhetoric between leaders of two political parties.

In November last year, Cabral and AAP MLA and Delhi Jal Board vice chairman Raghav Chaddha had also raised hype about a debate over the power tariffs in their respective states.

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UK News USA

UK, US agree to suspend retaliatory tariffs for 5 years

The 17-year dispute, the longest-running in the history of the World Trade Organisation, has seen damaging retaliatory tariffs levied on products on both sides of the Atlantic due to disagreements over support for large civil aircraft…reports Asian Lite News.

International Trade Secretary Liz Truss on Thursday struck an historic deal with the US on the Airbus-Boeing dispute in a major win for industries like Scotch whisky.

After talks with US Trade Representative Katherine Tai at the Department for International Trade’s headquarters in central London, both sides have agreed to suspend retaliatory tariffs for 5 years and cooperate more closely on tackling unfair trade practices by non-market economies.

The 17-year dispute, the longest-running in the history of the World Trade Organisation, has seen damaging retaliatory tariffs levied on products on both sides of the Atlantic due to disagreements over support for large civil aircraft.

The disagreement has hit industries such as cashmere, machinery, and single-malt Scotch whisky that employ tens of thousands of people across the UK. The Scotch Whisky Association estimates the tariffs have cost the sector hundreds of millions of pounds in lost revenue.

The UK, which was involved as a member of the EU, took the decision to deescalate the dispute by unilaterally suspending retaliatory tariffs on the US at the start of this year, which encouraged the US to agree to a four-month suspension of tariffs while both sides negotiated a longer-term arrangement.

“This deal will support jobs across the country and is fantastic news for major employers like Scotch whisky and sectors like aerospace,” said Liz Truss. “We took the decision to de-escalate the dispute at the start of the year when we became a sovereign trading nation, which was crucial to breaking the deadlock and bringing the US to the table.”

She said UK can focus on taking its trading relationship with the US to the next level, including working more closely to “challenge unfair practices by nations like China and using the power of free trade to build back better from the pandemic.”

Besides suspending countermeasures for 5 years, the UK and US will establishing a working group on large civil aircraft that is led by the respective Minister responsible for trade.

Both will provide financing to a large civil aircraft producer for the production or development of large civil aircraft on market terms.

The countries will also provide research & development funding for large civil aircraft: through an open and transparent process; making the results widely available; and not providing R&D funding, or other support, to producers of large civil aircraft in a way that would cause negative effects to the other side.

They will also collaborate on tackling non-market practices of third countries that may impact on their large civil aircraft industries.

Scottish Secretary Alister Jack said the suspension of retaliatory tariffs for five years is great news for the Scottish whisky industry – a cornerstone of Scotland’s economy.

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-Top News USA

Biden reinvigorates tariff war against India

US President Joe Biden

Threatens to increase import duties on a range of imports, from prawns and Basmati rice to furniture and jewellery, reports Arul Louis

The US tariff war against India has been reinvigorated by President Joe Biden threatening to increase import duties on a range of imports, from prawns and Basmati rice to furniture and jewellery, in retaliation against New Delhi imposing Digital Services Tax (DS) on tech giants.

The US Trade Representative Katherine Tai announced on June 2 the plan for the 25 per cent increase in the tariffs on 26 items from India, but said that the hikes will be on hold till December.

India imposed a two per cent tax starting in April last year on earnings in the country by foreign technology and e-commerce companies like Amazon, Facebook and Google. It was opposed by the administration of former President Donald Trump, and Biden has picked up the baton.

The Trade Representative’s Office said: “India’s DST is unreasonable or discriminatory and burdens or restricts US commerce.”

The Office estimated the increased taxes on the selected imports from India will equal the taxes India assesses on the US companies under the DST.

“Estimates indicate that the value of the DST payable by US-based company groups to India will be up to approximately $55 million per year. The level of trade covered by the action takes into five account estimates of the amount of tariffs to be collected on goods of India and the estimates of the amount of taxes assessed by India.”

The other items threatened with increased duties include bamboo, window shutters, cigarette papers, pearl, copper foil and bedroom furniture.

Inaugurating the new phase of trade wars, the Biden administration also threatened to increase tariffs on imports from five other countries — the UK, Austria, Italy, Spain and Turkey over their DST.

Explaining the reason for holding the increases in abeyance for the six countries, Tai said it was to help the international negotiations on taxation.

“The US remains committed to reaching a consensus on international tax issues through the OECD (Organisation for Economic Cooperation and Development) and G20 processes. Today’s actions provide time for those negotiations to continue to make progress while maintaining the option of imposing tariffs.”

In the first phase of the negotiations, the Finance Ministers of the G7, the major western industrial powers, meeting in London agreed on Saturday to a minimum 15 per cent corporate tax rate to prevent companies using legal loopholes to avoid paying taxes on incomes in countries where they operate.

The deal will next go to next month’s meeting in Italy of the G20 — a group of 19 countries, industrialised and developing, and the European Union.

India is a member of the G20.

The latest Biden salvo opens a new front in the trade war between the two countries that started in 2018 when Trump imposed 25 per cent duties on steel and aluminium imports from India.

In 2019, Trump withdrew the special treatment for some Indian exports, mostly low-tech items and handicrafts, under the General System of Preferences (GSP) that exempted them from import duties.

New Delhi retaliated with higher tariffs on 28 US products that included walnuts and almonds.

Biden has not so far taken steps to reinstate the GSP facility for India.

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-Top News India News USA

US Trade chief slams India’s high tariffs

Earlier, USTR had slammed India’s Equalisation Levy as discriminatory and unreasonable,creating significant new tax burden for the US companies…reports Asian Lite News

The US Trade Representative (USTR) in its latest report on Foreign Trade Barriers released on March 31 has highlighted major trade barriers to American exports, FDI and e-commerce.

This report has been issued by Joe Biden Administration’s newly appointed USTR, Katherine Tai who replaced Ambassador Robert Lighthizer after Donald Trump lost the election last year. It has found India’s trade policies discriminatory which creates both tariff and non tariff-barriers and poses a threat to US trade and imports to India. Trade barriers include government laws, regulations and policies.

Duties, according to the report, have been increased across two large groups: Labour-intensive products and electronics and communication devices, such as cell phones, televisions, and related parts and components.

Earlier in January 2021, USTR had found India’s Equalisation Levy as discriminatory and unreasonable,creating significant new tax burden for the US companies and/or restricting US commerce — forcing them to undertake costly compliance measures.

Finance Ministry issued clarifications in February 2021, but the matter, instead of improving, has become much worse. US companies across the board have complained that the latest interpretation means that even merchandise trade will be subject to Equalisation Levy. The new interpretation is increasing nervousness and fear of tax terrorism, due to retrospective impact of such levy, even further.

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According to the report, the United States’ trade deficit with India in 2020 was up 1.7 per cent to $23.8 billion, exports down 20.1 per cent to $27.4 billion, and India’s imports down 11.3 per cent to $51.2 billion, from last year. The report highlights that the US exporters continue to encounter significant tariff and non-tariff barriers. Additionally, there exists large disparities between WTO bound rates and India’s MFN applied rates — currently the highest in the world at 17.6 per cent.

In addition, the report also highlights the unpredictability and opaqueness that plagues India’s tariff regime and how it poses major challenges to the US trade to India. As per the report, the Indian Government used the last two Union Budgets to increase tariffs on approximately 70 product categories, including key US exports, without warning or public consultation.

The report also places a major focus on barriers to Digital Trade. From wide-ranging data localisation requirements across sectors and policies like the Personal Data Protection Bill, 2019, RBI localisation guidelines, yet-to-be released e-commerce policy to the much discussed Equalisation Levy, the USTR claims that these digital barriers will impede foreign trade and increase the risk of retaliation from other countries, putting interests of Indian companies at risk.

Commerce Minister Piyush Goyal has made every attempt to negotiate a trade deal with previous USTR Lighthizer since September 2019, but without success. Fresh tariff hikes, equalisation levy and the recently notified IT Rules highlighted in the report, will further queer the pitch for a trade negotiation with the new USTR Katherine Tai, with whom Goyal has already held an introductory meeting two weeks ago.

As per the USTR, the recently notified IT Rules “incentivize overly restrictive approaches to policing non-IP user-generated content and will undermine many Internet-based platform services.”

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Categories
-Top News Australia China

Morrison not okay with China’s new wine tariffs

Australian Prime Minister Scott Morrison

China and Australia have been facing deadlock in a trade since last year ….reports Asian Lite News

Australian Prime Minister Scott Morrison on Saturday said that new Chinese wine tariffs set to last for five years were “not ok” and deemed them as retaliation for Canberra standing up for its values.

The measures, which are set to take effect on Sunday, were described as anti-dumping duties by China in a Commerce Ministry announcement, dpa news agency reported.

Beijing and Canberra have been locked in a trade dispute that escalated last year and saw China hit wine, beef, barley and coal with trade tariffs and customs delays.

XI CHINA

Morrison pointed to Australia’s stance against the treatment of the Uighur Muslim minority in China as a reason for the latest move, in comments reported by Australian news agency AAP.

China this week slapped sanctions on British entities and individuals after the UK made a similar move, citing human rights concerns over internment camps in Xinjiang that are estimated to have held more than 1 million people since 2017.

Beijing says they are “vocational education centres”.

The UK’s action followed similar measures put in place by Canada, the European Union and the US.

Meanwhile, Australian Minister for Trade, Tourism and Investment Dan Tehan said the tariffs of between 116 and 218 per cent make it “basically impossible” for the country’s wine to compete in the Chinese market.

He said he had spoken to Australian wine industry leaders and was considering going to the World Trade Organization with the issue.

China is Australia’s largest trading partner.

In 2018-2019, China bought around 26 per cent of exports, valued at A$235 billion.

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