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Civil service- International Trade > Tariffs And RoO > Flashcards

Tariffs And RoO Flashcards

1
Q

What are RoO?

A

Rules of origin - the requirements a product has to meet for it to count as ‘originating’ from a certain country

This is so the preferential tariff from the FTA can be accessed

Otherwise the default MFN tariff (and typically higher tariff must be paid)

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2
Q

What is cumulation?

A

Surrounding Rules of origin- it’s like a wild card. It lets you receive an item from another country and pass it off as originating from yours
There’s different types:
Bilateral - between 2 trade partners , ie can import salmon from Norway (another reason to going PEM) and descale it and sell it as British

Diagonal

Full

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3
Q

What is VER?

A

Voluntary Export Restraint (VER)

A restriction where an exporting country voluntarily limits the amount of goods it can export to another country

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4
Q

What are AVE’s?

A

Ad-Valorem Equivalent- when non-percentage tariffs are estimated as a percentage

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5
Q

Ad Valorem Tariff

A

Tariff that is a percentage based on value of good

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6
Q

Specific tariff

A

It’s when a specific amount is charged per unit of the good

Eg. The tariff for 1 pound of fish is $0.23. i.e for each pound imported, the importer pays $0.23.

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7
Q

Compound

A

A compound tariff is a combination of an ad valorem tariff and a specific tariff.

Imaginary Ex: The tariff on chocolate is $2 per pound plus 15% ad-valorem (based on its value)

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8
Q

Mixed tariff

A

With mixed tariffs either ad valorem tariff or specific tariff is applied.

The one that is applied depends on if the goods weight/value is above or below a certain limit.

There often is a AV maximum duty that can be applied.

E.g. 6.3% + 30.9 EUR/100kg
MAX 18.2%

If the good is below 100kg for example a tariff of 6.3% of its value is applied, if its above 100kg the specific tariff is applied- overall the tariff can’t be more than 18.2% of the goods value

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9
Q

What is PEM and name 5 countries in it

A

Pan - European Mediterranean convention. This is an agreement between tries to make sure that its countries have similar RoO.

European Union, Iceland, Liechtenstein, Norway, Switzerland, Faroe Islands, Türkiye, Republic of Moldova, Ukraine, Georgia, Albania, Bosnia and Herzegovina, North Macedonia, Montenegro, Serbia

Morocco, Algeria, Tunisia, Egypt, Israel, Jordan, Lebanon, Palestine

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10
Q

What is the UKGT?

A

UK Global Tariff- it is the default tariff applied to all goods imported into the UK unless :
-there is a trade agreement in place

-a tariff suspension

-or the good comes from a developing country and benefits from DCTS (developing country trading scheme)

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11
Q

TRQ

A

Tariff Rate Quota:
When a good can be imported at a lower tariff - until a limit is reached

This may be imports from all countries or just some, depending on the product

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12
Q

ATQ

A

Autonomous Tariff Rate Quota

When a limited amount of a good can be imported FROM ANY COUNTRY at a lower tariff- once the limit is reached other imports have to come in at a higher tariff

Eg we have one for imports of raw sugar cane (up to 260,000 tonnes - annoyingly Brazil keep filling it)

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13
Q

Difference between ATQ and TRQs?

A

ATQs are open to imports from all countries , TRQs sometimes are only applied to specific countries

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14
Q

What’s a technical tariff?

A

When the tariff paid varies based on the amount of a certain ingredient within an item e.g. 0.4 EUR/100kg/%sacchar (sugar)

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15
Q

Anti -dumping duties

A

Anti-dumping duties are taxes placed on imported goods ,to make up for the difference between the export price and their normal value (in the exporters domestic market)

Dumping is when exporters charge a price that is lower than the their actual value (in the exporters domestic market)

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16
Q

Non-Advalorem tariff and state all types

A

Tariff that is not solely expressed as a percentage

i.e. Specific/flat rate, compound, mixed, tehnical

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17
Q

Country Tariff Dashboard?

A

Country Tariff Dashboard-
It allows you to have summary of trade between UK and chosen partner e.g. top 10 imports/exports,

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18
Q

What app is the best ways to find the tariffs the UK is applying?

A

UK Market Access app- Shows tariffs UK applies to rest of world, if it says ‘erga omnes’ this means its an MFN tariff, ‘tariff preference’ is if theres a trade deal

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19
Q

How do you calculate AVEs?

A

tariff/import price of good eg for a tariff of 180 GBP/100kg (specific tariff btw!) and import price of 30 GBP/100kg you’d do 180/30, so the AVE would be 6%

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20
Q

PUR

A

Preference utilisation rate- shows the share of eligible goods that used their preference

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21
Q

What does it mean if theres blanks for PUR column on PUR app?

A

It means this good wasn’t eligible for a tariff preference

22
Q

What does the treemap show you (PUR app)

A

Shows proportion of tariff eligibility, and usage for different HS chapters

23
Q

What does the time series show in PUR app?

A

Shows the change in utilisation overtime

24
Q

What is the PUR Literature slidepack

A

Gives us more insight on why there are low levels of utilisation

e.g. lack of awareness of preference, small gap between MFN and preference, RoO too strict

Also for better understanding of what is low/high level of utilisation i.e. may be 90% for some chapters but 60% for others

25
Q

Meursing Table

A

Complex table EU uses requires you to have info on

26
Q

Where can we get agri-production Data from?

A

AUK- Agriculture in UK
Prodcom

27
Q

State the different places we get trade data from

A

Trade Map- Partner countries trade levels

HMRC- UK Trade flows

HMRC RoO data- shows how industries impacted by changes in RoO

Import by preference- PUR data showing numbers of imports coming in under different prefrences

UK Business details - shows import/export values of UK business

28
Q

How do you calculate duties to be paid?

A

duties to be paid =AVE*Import price

29
Q

Consumption Data

A

ONS Family Spending workbook- shows how much consumers spend on different types of tariffs

Helped to know where tariffs could be liberalised to help families during cost of living

30
Q

Bilateral Cumulation

A

Between 2 trade partners. Allows goods country A receives from country B to count as originating

31
Q

Give an example of how bilateral cumulation would work

A

If a UK car company sourced all of the parts from across the EU and then put it all together in a factory in the UK, it could sell it back to a customer in the EU, taking advantage of the preferential zero tariff rate, as if all the bits of the car originated in the UK.

32
Q

Diagonal Cumulation

A

Intermediate goods that come from another country count as originating when working with another country if they have a trade deal

eg If UK get has a FTA with the EU that allows for diagonal cumulation with Norway, the UK could import salmon from Norway and export it to the EU and it would count as originating from UK

33
Q

Full cumulation

A

Goods from the partner country always count as originating even if they’re from a foreign country

Eg Chinese yarns are imported into Tunisia where they are manufactured into fabric.
(They now count as Tunisian)

34
Q

DCTS

A

Developing Country Trading Scheme

A scheme to make it easier for developing countries to access the UK’s market

-Lower tariffs
-Relaxes rules of origin

35
Q

Whats the difference between DCTS and GSP

A

Developing Country Trading Scheme replaced Generalised System of Preferences in June 2023

It includes more countries, (all countries previously included and 18 more countries the World Bank classes as low or low middle income

36
Q

What’s a seasonal tariff and why might it be applied?

A

Its a tariff that only applies at certain times of the year i.e. a on tomatoes that applies only in the summer

37
Q

Nuisance tariff

A

Tariff below 2%

38
Q

DBT Mega-spreadsheet Offensive/Defensive

A

A spreadsheet showing:
-MFN tariffs
-preferential tariffs
-estimates of duties paid (AVE* trade volume)

DBT has this spreadsheet for every country we’re negotiating with

They’re in the DBT sharepoint

39
Q

What is FETT?

A

Four Equation Trade Tool, produced by TMU it shows the impact on imports/exports if there was full tariff liberalisation (tariffs removed)

40
Q

What is the bronze deck?

A

A slide deck we create for our low priority FTA’s

Shows general overview on:

-The countries economic position GDP etc
- some of the potential top imports/exports if full tariff liberalisation took place

41
Q

Whats the tariff model

A

Shows the UK and partner countries top offensives and defensives

The light model only calculates the UK’s top offensives

42
Q

PSR Analysis model

A

Categorises agri-food goods and shows what we think the PSR will be if a trade deal is negotiated

RAG to show how likely countries are to meet a change in RoO (red if unlikely)

Looks at precedent ie what PSR was negotiated in the previous trade deal

43
Q

What is the offer comparison model?

Also explain what each othe the categories mean

A

Allows us to easily compare offers, comparing the amount of lines for which tariff has been completely removed and the value of imports for such goods

Shows the number of lines where the tariff has been partially dropped, as well as lines where there’s been no change.

A- this means the tariff is removed

B10- means the tariff will be dropped, but gradually over a 10 year period.

B5- means the tariff will be dropped, but gradually over a 5 year period.

U- means that the tariff will not be removed.

44
Q

Inward TRQ

A

TRQ for imports coming IN to UK

45
Q

What is FETT

A

Four Equation Trade Tool.
It models the predicted change in imports/exports if tariffs were fully liberalised

46
Q

What is tariff water?

A

The gap between the maximum (bound) tariff that can be applied and the actual applied tariff

47
Q

What is bounding overhang?

A

Same as tariff water. The gap between the maximum (bound) tariff that can be applied and the actual applied tariff

48
Q

What are the limitations to AVEs?

A

We only calculate AVE’s for UK-EU data so they’re even more inaccurate if being applied to goods from other countries.

AVE’s are only relevant to the country whose tariff schedule was used- they can’t be transferred to other countries.

They’re calculated for the CN8 level so extra steps need to be taken if looking at a different level of data.

AVE’s rely on unit price (value/volume) numbers which can be misreported at customs.

49
Q

What’s the Merusing Table?

A

It forms part of the EU’s CET and is a table that shows the additional tariff charged on processed goods that contain milk, milk proteins, sucrose, glucose etc

It’s aim is to make sure it isn’t cheaper to import processed goods than make them domestically using raw materials

It’s seen as a NTB as it complicates the trade process for exporters

50
Q

What are some of the reasons for applying tariffs on imports?

A

To protect domestic producers

To raise revenue for the government

To combat unfair dumping

Civil service- International Trade (7 decks)

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