Thursday, March 25, 2004
The United States is preparing to file a complaint with the World Trade Organization (WTO) against China because of its controversial value-added tax on semiconductors, raising the ante in a long-running trade skirmish over chips.
The complaint could come this week, according to media reports, and follows a warning last week by US Trade Representative Robert Zoellick.
During testimony before a Senate panel, Zoellick told lawmakers that China's 17 percent value-added tax on imported semiconductors was discriminatory. "If they don't stop it, we're going to take action," he said.
If the US files the complaint, it would be the first against China since the country joined the WTO in December 2001. Its value-added tax has long been a sore spot of contention because many foreign companies and governments view it as a back-door tariff that encourages capital investment in China to avoid the tax and exacerbates the US-China trade imbalance, which reached $123 billion in 2003, up from $103 billion in 2002.
The complaint could come this week, according to media reports, and follows a warning last week by US Trade Representative Robert Zoellick.
During testimony before a Senate panel, Zoellick told lawmakers that China's 17 percent value-added tax on imported semiconductors was discriminatory. "If they don't stop it, we're going to take action," he said.
If the US files the complaint, it would be the first against China since the country joined the WTO in December 2001. Its value-added tax has long been a sore spot of contention because many foreign companies and governments view it as a back-door tariff that encourages capital investment in China to avoid the tax and exacerbates the US-China trade imbalance, which reached $123 billion in 2003, up from $103 billion in 2002.
By: DocMemory
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