The absence of tariffs on electronic transmissions has little impact on customs revenues, according to a study published on 18 November by the Organisation for Economic Co-operation and Development (OECD). On the other hand, its interruption would lead to greater economic losses, to the detriment of consumer welfare and export competitiveness.
On 6 November, EU Trade Commissioner Cecilia Malmström brought up, before the European Parliament, the issue of the renewal of the Moratorium on the imposition of customs duties on electronic transmissions which is one of the topics on the agenda of the June 2020 WTO Ministerial meeting.
For more than twenty years, the members of the multilateral organisation have been extending the Moratorium on tariffs on all “digitally delivered trade”.
Nevertheless, with the increase in digital trade, voices have been raised questioning the validity of this Moratorium. It is mainly questioned for its impact on public revenues: new estimates estimate the shortfall between $280 million and $8.2 billion - a range which, however, by its width underlines “a wide disagreement on measurement”, the authors of the study note. They believe that the Moratorium would most likely have a small impact on incomes - and that these would be very unstable.
But the imposition of tariff duties on these transmissions would also have a cost whose burden would fall mainly on domestic consumers, the report states.
The authors also point out that there are “considerable advantages” in conducting commercial transactions electronically, with additional welfare gains from, for example, reduced transport costs.
Services to foreign companies are also increasingly provided digitally and are associated with increasing export competitiveness, especially for SMEs.
The authors therefore call for an open debate, weighing all these considerations.
The study: https://bit.ly/2rVj5uN (Original version in French by Hermine Donceel)