Chapter 1 : Tariffs[1]

 

Objective

 

APEC economies will achieve free and open trade in the Asia-Pacific region by:

 

a.                   progressive reduction of tariffs until the Bogor goals are fully achieved; and

 

b.         ensuring the transparency of APEC economies’ respective tariff regimes.

 

 

Guidelines

 

Each APEC economy will:

 

a.                   take into account, in the process of achieving the above objectives, intra-APEC trade trends, economic interests, sectors or products related to industries in which this process may have positive impact on trade and on economic growth in the Asia-Pacific region and developments in the new economy;

 

b.                  ensure that the achievement of the above objective is not undermined by the application of unjustifiable measures; and

 

c.         consider extending, on a voluntary basis, to all APEC economies the benefits of tariff reductions and eliminations derived from sub-regional arrangements.

 

 

Collective Actions

 

APEC economies will:

 

a.                   participate and ensure the expeditious supply and updates of the WTO Integrated Database and any other APEC databases;

 

b.                  arrange for seminars and/or workshops on industrial tariffs negotiations in consultation with international organisations, where appropriate,  including  WTO Secretariat on WTO Integrated Tariff Database;

 

c.                   study lessons from modalities for tariff reduction and elimination in regional arrangements; and

 

d.                   encourage the accession of all economies to the WTO Information Technology Agreement, including the adoption of ITA provisions by non-members of the WTO.

 

The current CAP relating to tariffs can be found in the Tariffs and Non-Tariff Measures Collective Action Plan

 

 

Canada’s Approach to Tariffs in 2003

 

The Government of Canada pursues a policy of tariff and trade liberalization to further advance Canada’s broad trade agenda, including the negotiation and implemention of multilateral, regional and bilateral trade agreements, and through unilateral tariff reduction iniatives. The Minister of Finance is responsible for import policy, aimed at securing and improving access to foreign markets for Canadian business while supporting an efficient and competitive domestic economy. 

 

The key import policy instruments in Canada are as follows; information about these may be viewed on-line as indicated:

 

Customs Tariff  (Most recent consolodated version, and details of previous ammendments)

http://www.ccra-adrc.gc.ca/cus
toms/general/publications/cust
oms_tariff-e.html

 

The Special Import Measures Act

http://laws.justice.gc.ca/en/S
-15/index.html

http://www.ccra-adrc.gc.ca/cus
toms/business/sima/act-regs-e.
html

 

The Canadian International Trade Tribunal Act 

http://laws.justice.gc.ca/en/C
-18.3/index.html

http://www.citt.gc.ca/

 

Canada is commited to advancing free and open trade.  Successive rounds of multilateral trade negotiations under the General Agreement on Tariffs and Trade (GATT) combined with regional and bilateral free-trade agreements have reduced tariffs to a point where they are less significant in many markets today.  However, important tariff barriers remain in many economies.  Consequently, Canada is actively engaged in the WTO Doha Round of multilateral negotiations, as well as in the Free Trade Area of the Americas regional negotiations, and in other negotiations with the four Central American countries of El Salvador, Guatemala, Honduras and Nicaragua.  In addition, Canada continues discussions to explore the scope of possible negotiations with the Andean Community of Bolivia, Colombia, Ecuador, Peru and Venezuela, with the Caribbean Community and Common Market (CARICOM), and with the Dominican Republic.

 

Among APEC member economies in the context of the Bogor goals concerning tariffs, Canada is approaching the ten-year anniversary of the North American Free Trade Agreement (NAFTA) with the United States and Mexico.  Staged tariff reductions under NAFTA are fully implemented; many ahead of schedule.  The Canada-Chile Free Trade Agreement has been in force since 1997, and the last of staged tariff reductions under this Agreement took place in January 2003.  Bilateral negotiations with Singapore are ongoing.  (For further information please visit: http://www.dfait-maeci.gc.ca/t
na-nac/reg-e.asp
) 

 

In addition, 16 APEC members are eligible for Canada’s General Preferential Tariff (GPT), which is provided on a unilateral basis.

 

Contact information:

Marnie Fyten

Government of Canada

Department of Finance

fyten.marnie@fin.gc.ca

 


 

 

Case Study of a Tariff Liberalisation Initiative

 

N/A

 


 

Canada’s Approach to Tariffs in 2003

Section

Improvements Implemented Since Last IAP

Current Tariff Arrangements

Further Improvements Planned

 

Bound Tariffs

 

 

 

 

 

 

99.7% of items in HS Chapters 1 - 97 of the Canadian Customs Tariff are WTO bound.

 

 

 

 

Applied Tariffs

 

 

 

Canada continues to meet its Uruguay Round WTO commitments, including reductions to MFN tariffs on products including textiles and clothing, each January, through 2004.

 

Canada eliminates "nuisance tariffs" (those below a 2% threshold) from MFN and preferential tariffs, each January.

 

Canada continues to unilaterally reduce applied tariffs on certain goods used in the production of other goods (manufacturing inputs) or in the provision of services.

 

 

In 2002, 89% of imports into Canada, by value of goods, entered duty-free under MFN, unilateral or negotiated preferential tariff treatments, and the import-weighted average applied tariff was merely 1%.

 

In general, Canada’s MFN tariffs are applied slightly below bound levels; the simple average bound and applied MFN tariff rates are currently 5.1 and 4.0 percent, respectively.

 

Current tariff rates are available on-line through the APEC tariff database (http://www.apectariff.org/) and on the Canada Customs and Revenue Agency’s website at: http://www.ccra-adrc.gc.ca/cus
toms/general/publications/tari
ff2003/tablewithamendments-e.h
tml

 

 

Canada will work together with APEC member economies towards a successful WTO Doha Round, that includes real and substantial improvements in market access, within a fair and equitable multilateral trading system, while continuing to implement Uruguay Round tariff reduction commitments.

 

Tariff Quotas

 

 

 

Canada eliminated tariff rate quotas on most imports (except for dairy products, poultry and eggs) from 48 Least Developed Countries, on January 1, 2003.

 

 

Only 2% of items in HS Chapters 1 - 97 are subject to tariff rate quotas (TRQs), reflecting sensitivities in Canada's agricultural sector. Information explaining Canada’s TRQ system can be found on-line at: http://www.ccra-adrc.gc.ca/E/p
ub/cm/d10-18-1/d10-18-1-e.pdf

 

 

 

 

 

Tariff Preferences

 

 

The Canada-Costa Rica Free Trade Agreement came into force on November 1, 2002.

 

The last of staged tariff reductions under the Canada - Chile Free Trade Agreement were implemented in January 2003.  Final tariff reductions on eligible items imported from Mexico, under NAFTA, were also implemented in January 2003.

 

 

Canada has 10 preferential tariff treatments, including the following negotiated agreements that contain staged tariff reductions:

 

- the Canada-United States Free Trade Agreement;

- the North American Free Trade Agreement (NAFTA);

- the Canada-Israel Free Trade Agreement;

- the Canada-Chile Free Trade Agreement; and

- the Canada-Costa Rica Free Trade Agreement

 

For information on the above Agreements please visit:

http://www.dfait-maeci.gc.ca/t
na-nac/reg-e.asp

 

Canada also maintains unilateral tariff preferences for developing and least-developed countries.  Canada introduced its General Preferential Tariff (GPT) scheme for developing countries in 1974.  16 APEC members are eligible for the GPT, which ranges from tariff-free to 2/3 of MFN rates.  For more information, see Section 33 of the Cutsoms Tariff.

 

Duty free entry was provided to all GPT-eligible products from the least-developed countries in 1983.  The LDC product coverage was extended twice; in August 2000 and again in January 2003.  Most imports from LDCs (except for dairy products, poultry and eggs) may now enter Canada duty and quota free.

 

 

In addition to working together with APEC member economies towards a successful WTO Doha Round, Canada is also actively engaged in the Free Trade Area of the Americas negotiations and in negotiations with the four Central American countries of El Salvador, Guatemala, Honduras and Nicaragua.  Canada continues discussions to explore the scope of possible negotiations with the Andean Community of Bolivia, Colombia, Ecuador, Peru and Venezuela, with the Caribbean Community and Common Market (CARICOM), and with the Dominican Republic.

 

 

 

Transparency of Tariff Regime

 

 

 

 

 

Canada provides annual updates of tariff and trade information to the WTO Integrated Database.

 

Current tariff rates are available to the public in viewing or downloadable format through the APEC tariff database (http://www.apectariff.org/) and on the Canada Customs and Revenue Agency’s website: http://www.ccra-adrc.gc.ca/cus
toms/general/publications/tari
ff2003/tablewithamendments-e.h
tml

 

See the tariff summary and dispersion tables at the end of this chapter, for more information.

 

 

 



Improvements in Canada’s Approach to Tariff  Measures since 1996

Section

Position at Base Year (1996)

Cumulative Improvements Implemented to Date

 

Bound Tariffs

 

 

 

 

 

 

99.7% of items in HS Chapters 1 - 97 of the Canadian Customs Tariff are WTO bound.

 

 

Applied Tariffs

 

 

 

Between 1996 and 2002 the percentage of imports, by value of goods, that enters Canada duty-free under MFN, unilateral or negotiated preferential tariff treatments, has risen from 78% to 89%.

 

Canada’s import-weighted average tariff applied to all imports has decreased from 1.32% in 1996 to 0.93% in 2002.

 

In February of 1994, the Government of Canada launched a comprehensive review of Canada’s tariff regime aimed at making Canada’s tariff system simpler, more transparent and predictable.  As a result, on January 1, 1998, Canada’s new simplified Customs Tariff came into effect, systematically modifying Canada’s tariff structure and reducing tariff levels.

 

 

On an annual basis commencing January 1, 1995, Canada has implemented its tariff reduction commitments as per the Uruguay Round agreement in the WTO, including the zero-for-zero initiatives.

 

Canada removed tariffs on pharmaceutical products as a result of Pharma II (April 1997) and Pharm III (July 1999) commitments in the WTO.

 

Canada as a signatory to the Information Technology Agreement (ITA), reduced tariffs on all products subject to that agreement.  Final reductions were implemented  January 1, 2000.

 

Canada accelerated to 1998,the Uruguay Round tariff reductions for all products that were to have final cuts in 1999, including zero-for-zero initiatives in the medical equipment, agricultural equipment, construction equipment, and office furniture sectors.

 

Canada has reduced all applied tariffs below 2%, to zero, on an annual basis since January, 1998.

 

Canada unilaterally reduces applied tariffs on certain goods used in the production of other goods (manufacturing inputs) or in the provision of services.

 

 

Tariff Quotas

 

 

 

 

 

 

Only 2% of items in HS Chapters 1 - 97 are subject to tariff rate quotas (TRQs), reflecting sensitivities in Canada's agricultural sector. Information explaining Canada’s TRQ system can be found on-line at: http://www.ccra-adrc.gc.ca/E/p
ub/cm/d10-18-1/d10-18-1-e.pdf

 

 

Tariff Preferences

 

 

 

By 1996, Canada had negotiated the following significant preferential trade agreements:

 

 - the Canada-United States Free Trade Agreement;

 - the North American Free Trade Agreement; and

 - the Canada-Israel Free Trade Agreement.

 

Canada introduced its General Preferential Tariff (GPT) scheme for developing countries (including 16 APEC members) in 1974. Duty free entry was provided to all GPT-eligible products from the least-developed countries in 1983. 

 

 

Canada is approaching the ten-year anniversary of the North American Free Trade Agreement (NAFTA) with the United States and Mexico.  Staged tariff reductions under NAFTA are fully implemented; many ahead of schedule. 

 

The Canada-Chile Free Trade Agreement came into force on July 1997.  Canadian tariffs on most goods from Chile were eliminated at that time, with the last of staged tariff reductions being implemented in January 2003. 

 

The Canada-Costa Rica Free Trade Agreement came into force on November 1, 2002.

 

The LDC product coverage was extended twice; in August 2000 and again in January 2003.  Most imports from LDCs (except for dairy products, poultry and eggs) may now enter Canada duty and quota free. Canada also liberalized the origin requirements that apply to LDC imports, in 2000.

 

 

Transparency of Tariff Regime

 

 

 

In February of 1994, the Government of Canada launched a comprehensive review of Canada’s tariff regime aimed at making Canada’s tariff system simpler, more transparent and predictable.  As a result, on January 1, 1998, Canada’s new simplified Customs Tariff came into effect, systematically modifying Canada’s tariff structure and reducing tariff levels.

 

 

The new Customs Tariff, which came into effect on January 1, 1998, introduced a number of liberalizing measures that are of benefit to international traders, including those from APEC economies.

 

Overall, the Canadian tariff system has become more simple, predictable, and transparent by replacing the existing seven tariff schedules with a single tariff schedule containing a simpler rate structure and significantly fewer provisions (about 8,000 compared to 11,000). The system was further simplified by eliminating or streamlining a significant number of legislative provisions and introducing a more flexible tariff schedule format (two tariff columns rather than five).  Some of these measures have also broadened the scope of certain existing duty free provisions.

 

Canada provides annual updates of tariff and trade information to the WTO Integrated Database.

 

Current tariff rates are available to the public in viewing or downloadable format through the APEC tariff database (http://www.apectariff.org/) and on the Canada Customs and Revenue Agency’s website: http://www.ccra-adrc.gc.ca/cus
toms/general/publications/tari
ff2003/tablewithamendments-e.h
tml

 

See the tariff summary and dispersion tables at the end of this chapter, and in previous annual individual action plans, for more information.

 

 


 

APEC INDIVIDUAL ACTION PLAN:  TARIFF SUMMARY REPORT FOR 2003

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

All Goods

Agriculture excluding Fish

Fish and Fish Products

Petroleum Oils

Wood, Pulp, Paper and Furniture

Textiles and Clothing

Leather, Rubber, Footwear and Travel Goods

Metals

Chemical & Photographic Supplies

Transport Equipment

Non-Electric Machinery

Electric Machinery

Mineral Products, Precious Stones & Metals

Manufactured Articles, n.e.s

ITEM

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Bound tariff lines as a percentage of all lines

99.7%

100.0%

100.0%

53.3%

100.0%

100.0%

100.0%

100.0%

100.0%

100.0%

100.0

100.0%

97.3%

99.9%

Duty-free tariff lines as a percentage of all lines

50%

40%

73%

50%

77%

31%

35%

64%

48%

41%

71%

56%

73%

51%

Preferential tariff lines as a percentage of all lines (GPT)

82%

65%

93%

100%

99%

45%

89%

76%

99%

99%

100%

99%

98%

98%

Preferential tariff lines as a percentage of all lines (LDCT)

88%

87%

100%

100%

100%

100%

100%

100%

100%

100%

100%

100%

100%

100%

Ratio of tariff lines with quotas to all lines

183:8515

183:1386

 

 

 

 

 

 

 

 

 

 

 

 

Simple average bound tariff rate

5.1%

4.7%

1.7%

5.2%

2.1%

12.5%

7.8%

3.0%

4.6%

5.4%

3.3%

4.1%

2.7%

4.0%

Simple average applied tariff rate

4.0%

3.9%

1.4%

3.3%

1.6%

9.4%

5.7%

1.9%

3.1%

5.2%

1.7%

2.4%

2.0%

3.2%

Simple average applied preferential tariff rate - GPT

1.3%

1.5%

0.7%

1.3%

0.6%

3.4%

1.9%

1.0%

1.2%

1.3%

0.2%

0.7%

0.5%

1.0%

Simple average applied preferential tariff rate - LDCT

0.0%

0.0%

0.0%

0.0%

0.0%

0.0%

0.0%

0.0%

0.0%

0.0%

0.0%

0.0%

0.0%

0.0%

Average applied tariff rate for all lines subject to duty

8.4%

8.7%

5.2%

6.5%

6.9%

13.6%

8.6%

5.2%

5.8%

8.9%

5.7%

5.4%

7.2%

6.4%

Import-weighted average applied tariff rate FOB

1.0%

1.8%

0.4%

0.0%

0.7%

9.1%

4.5%

0.6%

0.5%

0.8%

0.1%

0.3%

0.5%

0.6%

Import-weighted average bound tariff rate - FOB

5.0%

3.8%

1.7%

5.2%

1.7%

12.2%

7.2%

3.0%

4.5%

5.3%

3.3%

4.1%

2.7%

4.0%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 Notes:   Based on 2002 imports and 2003 tariff information                                 

              GPT – General Preferential Tariff treatment

              LDCT – Least Developed Country Tariff treatment

 

 

 

 

 

 

 

 

 

 

 

 

 

 

                      

 


 

APEC INDIVIDUAL ACTION PLAN:  TARIFF DISPERSION TABLE FOR 2003

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

All Goods

Agriculture excluding Fish

Fish and Fish Products

Petroleum Oils

Wood, Pulp, Paper and Furniture

Textiles and Clothing

Leather, Rubber, Footwear and Travel Goods

Metals

Chemical & Photographic Supplies

Transport Equipment

Non-Electric Machinery

Electric Machinery

Mineral Products, Precious Stones & Metals

Manufactured Articles, n.e.s

NUMBER OF TARIFFS AT OR BETWEEN

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

0%

4268

550

98

8

273

437

132

592

597

98

582

337

242

322

0%<X<=5%

988

149

25

4

18

39

89

152

176

7

58

109

23

139

5%<X<=10%

1909

214

10

4

60

241

81

175

484

105

181

156

59

139

10%<X<=15%

535

73

1

0

2

386

26

10

0

12

0

1

3

21

15%<X<=20%

396

9

0

0

3

303

55

0

1

5

0

0

6

14

>20%

23

12

0

0

0

0

0

0

0

11

0

0

0

0

Specific (includes 1 “N/A” - not applicable)

396

379

0

0

0

17

0

0

0

0

0

0

0

0

TOTAL

8515

1386

134

16

356

1423

383

929

1258

238

821

603

333

635

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Note:  Based on 2003 Tariff information

 

 

 

 

 

 

 

 

 

 

 

 

 

 

                                      

 

 



[1]  “Tariffs” here refers to import/export tariffs as well as tariff quotas.