WTO MC12: India to oppose zero Customs duties on electronic transmissions

India will strongly oppose continuation of a moratorium on imposing customs duties on electronic transmissions at the World Trade Organization’s crucial 12th ministerial meeting (MC12) that is scheduled to begin on June 12, government officials said on Tuesday.

They said that India will push for a review of the moratorium as it would help developing countries generate more revenue through customs duties.

In 1998, WTO members agreed not to impose customs duties on electronic transmissions and the moratorium has been periodically extended at successive ministerial conferences.

At MC12, many WTO member nations are seeking temporary extension of the moratorium until the next ministerial. “At the 12th MC next month, many WTO members are seeking temporary extension of the moratorium till 13th MC but India does not want this time to continue this further. India will take a hard stand this time on the matter,” one of the officials said.

India and South Africa have been making several joint submissions at the WTO, highlighting the adverse impact of the moratorium on developing countries. They have suggested that a reconsideration of the moratorium is important for developing countries to preserve policy space for their digital advancement, regulate imports and generate revenue through customs duties.

According to an earlier communication of these two countries, the potential tariff revenue loss to developing countries is estimated at $10 billion annually.

India is witnessing an exponential rise in imports of electronic transmissions, mainly of items like movies, music, video games and printed matter, some of which could fall within the scope of the moratorium. While the profits and revenues of digital players are rising steadily, the ability of the governments to check these imports and generate additional tariff revenues is being severely limited because of the moratorium on e-commerce, they said.