Japan”Taxes on Alcoholic Beverages Essay

Published: 2020-04-22 15:24:05
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The Japan Liquor Tax Law (Shuzeiho) taxes liquors sold in Japan based on the type of beverage. There are ten categories of beverage. Shochu is distilled from potatoes, buckwheat, or other grains. Shochu and vodka share many characteristics. However, vodka and other imported liquors fall in categories with a tax rate that is seven or eight times higher than the category for shochu. Foreign spirits account for only 8 percent of the Japanese market, whereas they account for almost 50 percent of the market in other industrialized countries.

The United States, the European Union, and Canada called for consultations before the WTO. The panel held that the Japanese tax law violated GATT, and Japan appealed to the Appellate Body. Issue: Does the Japanese Liquor Tax Law violate the national treatment provisions of GATT Article III? Decision: The Japan Liquor Tax Law was found to violate the national treatment provisions of GATT Article III. The decision of the panel was upheld and Japan was requested to bring its tax law into compliance with GATT.

Reasoning: Shochu is a like-product and is directly competitive and substitutable with other imported spirits. The imported spirits were taxed higher than the shochu. India”Quantitative Restrictions on Imports of Agricultural, Textile, & Industrial Products WT/DS90/R (April 6, 1999) Report of the Panel of the World Trade Organization Facts: India is a rapidly developing country of over 1 billion people, one-third of which are under the age of 15. Over 80 percent are of the Hindu religion.

Although its per capita GDP is only about $2,500, with almost 25 percent of the population living below the poverty line, during the late 1990s its economy grew to an annual rate of about 6 percent. While its economy is largely agriculture based, it is also strong in the areas of textiles, chemicals, food processing, steel, industrial goods, financial services, technology, and computer software. It has a rapidly growing consumer sector. For the past fifty years, India has placed complex restrictions on the import of agricultural, industrial and consumer goods from other countries.

Goods placed on the negative list could only be imported by special license, which was generally only granted to the actual user, rather than to firms in the normal chain of distribution. Many goods could only be imported by state agencies. The restrictions were, in many cases, applied arbitrarily and in the discretion of Indian government officials on a case-by-case basis. As a result, it was often impossible to know at any given time what goods might be allowed into the country.

In 1997, the United States filed a dispute with the WTO against India requesting that restrictions on 2,714 products be removed. India claimed that without restrictions its foreign exchange would leave the country, upsetting its balance of payments and inhibiting its economic development. Issue: Do Indias quantitative restrictions and the licensing scheme at issue justify to preserve its balance of payments? Decision: Indias measures are not justified under the terms of Article XVIII:B.

Indias quantitative restrictions and the licensing scheme at issue were no longer justified to preserve its balance of payments and needed to be quickly phased out. Reasoning: Indias balance-of-payments situation was not such as to allow the maintenance of measures for balance-of-payments purposes under the terms of Article XVIII9, that India was not justified in maintaining its existing measures under the terms of Article XVIII:11, and that it does not have a right to maintain or phase-out these measures on the basis of other provisions of Article XVIII:B which it invoked in its defense.

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