Ukraine, WTO to hold consultations on additional import tax on June 11
Ukraine and the World Trade Organization have agreed that the next round of consultations on additional import tax, set by Ukraine at 5-10%, will be held on June 11, Ukraine's Ministry for Economic Development and Trade has said.
Ministry experts participated in a meeting of the WTO Restrictions Committee on April 27-29, which covered the additional import tax introduced by Ukraine to improve its balance of payments. The meeting was attended by representatives of concerned WTO member countries.
During the consultations, the Ukrainian delegates presented their reasons as to why the tax is necessary, saying that the tax is aimed at stabilizing the balance of payments.
A representative of the International Monetary Fund (IMF) briefed those present on the reforms that have been initiated in Ukraine, the causes and consequences of the economic crisis in the country, measures to stabilize the balance of payments, and the adoption of the Extended Fund Facility cooperation program between Ukraine and the IMF. The expert also gave forward-looking assessments of the economic situation in Ukraine in 2015 and 2016.
According to the ministry, most of the WTO member states agreed that Ukraine's balance of payments had deteriorated. Representatives of individual countries noted that the additional import tax increases the burden on their exporters and urged Ukraine to cancel the tax by no later than then end of 2015.
As reported, on February 25, due to a sharp deterioration in the balance of payments, Ukraine introduced additional import duty on imports, except for critical imports, which was registered in the parliament and adopted in late 2014 after the government proposed the law, "On the stabilization of the balance of payments of Ukraine."
As reported, on February 25, 2015, due to worsening of the balance of payment Ukraine extended the additional imports duty to all goods, apart from critical imports stipulated in the law on the stabilization of Ukraine's balance of payment passed by the Ukrainian parliament in late 2014.
The law foresees the introduction of a 10% duty on finished food, fats, vegetable oil and butter, alcohol and non-alcoholic drinks, tobacco, vinegar, live animals (goods groups 1-24 under the Ukrainian code). The 5% duty is imposed on any other goods, apart from vitally important goods, including energy goods and some drugs.