The European Union plans to approach the World Trade Organization’sdispute settlement body against trade barriers maintained by India on imported wines and spirits, reports Business Standard. It has served a notice to the Indian government in this regard. According to WTO procedures, a country approaching the dispute settlement body holds consultations with the country concerned before requesting setting up of a dispute panel. EU’s intention to approach the WTO comes less than a week after the European Commission formally sent its investigation report to India on trade barriers on imported wines and spirits.
The report shows clear violation of WTO provisions and recommends WTO consultations unless India abolishes the additional duty on wines and spirits.
The EU has pointed out that India imposes an additional duty on all imported wines and spirits. In addition, excise duties and taxes are applied exclusively or at rates higher for imported wines than those for domestic products by certain states. There are also restrictions on import and sale as stipulated by certain states, it feels.
Countervailing Duty has been imposed by the Government on imported liquor to neutralise the excise duty on domestic liquor. The tax is an average of the various levels of excise duties imposed by different states. Over and above this, states impose excise duty on their local liquor and CVD on liquor manufactured by other states.
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