WTO tariff freeze on digital trade extended till June ’20

Deccan Chronicle.  | Emma Farge

Business, Companies

The moratorium on digital trade worth an estimated $225 billion a year has been in place since 1998, but was due to expire in December.

Several countries, including India and South Africa, have expressed interest in lifting the moratorium as they develop their digital economies and seek to recuperate lost customs revenue as more trade becomes digital.

GENEVA: World Trade Organization (WTO) members agreed on Tuesday to renew a 20-year moratorium on placing tariffs on digital trade for six months, allaying fears that people would have to pay duties on e-books and software for the first time.

The moratorium on digital trade worth an estimated $225 billion a year has been in place since 1998, but was due to expire in December and required unanimity at the WTO for renewal.

"Members agree to maintain the current practice of not imposing customs duties on electronic transmissions until the 12th Ministerial Conference," the General Council's decision said, referring to a WTO meeting in Kazakhstan in June.

The decision came after talks ran late into Monday evening, two trade officials said.

Several countries, including India and South Africa, have expressed interest in lifting the moratorium as they develop their digital economies and seek to recuperate lost customs revenue as more trade becomes digital. Some said this could lead to tit-to-tat tariffs on the internet.

John Denton, Secretary General of the International Chamber of Commerce, welcomed the decision and said it indicated "the continued value of the WTO as a forum for multilateral trade policy making" after members failed to resolve a crisis at its top court on Monday.

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