Time running out on US tax breaks, Lamy warns

[denverbill]

http://story.news.yahoo.com/news?tmpl=story&cid=1519&e=6&u=/afp/20040219/bs_afp/eu_us_wto_trade_dispute_040219183948

BRUSSELS (AFP) - EU Trade Commissioner Pascal Lamy warned that the United States faces a race against time to thwart multi-million-dollar sanctions over illegal tax breaks for US exporters.

But he played down talk of a new trade war erupting unless the US Congress failed to repeal the Foreign Sales Corporation (FSC) law in time to avoid the World Trade Organisation-backed sanctions by a March 1 deadline.

"It's a race against the clock," Lamy told reporters, noting that measures to repeal the FSC law were making only slow progress through both houses of Congress.

The EU is set to impose trade tariffs starting at 200 million dollars (164 million euros) from March 1 unless the FSC tax breaks -- which have been ruled illegal by the WTO -- are scrapped.
<snip>

Ah, I see the EU is proposing protectionist tariffs to protest unfair US trade practices. What do the free traitors at DU have to say about that?

[sweetheart]

1. The EU is right.

The whole scam involves transfer pricing. The home (American)
company takes products marked internally for transfer to foreign buyers.
Then the sales corporation, incorporated in a tax haven, makes the
retail markup and takes the profit as untaxed in said
off-shore haven. It is a subsidy of American tax payers to
corporations

who are circumventing the spirit of tax laws. The only reason
America's government is for FSC's, is because of bribes and
corporate lobbying... certainly not democracy, or any form of
economic justice.

The EU can only play hardball, as reason is clearly no longer
respected stateside. The real hope is to get rid of the republican
assholes and get back to straight talk and fair trade discussion.

[denverbill]

3. In all honesty, Republican's don't have a monopoly on assholes.

Clinton ran in 1992 supporting NAFTA and signed it into law a few years later.

Gephardt has been one of the few consistant opponents of NAFTA over the years. I'm beginning to regret not supporting him this year.

[sweetheart]

5. Aye, NAFTA is misguided

Any intelligent person must ask, why the nations bordering on a world economic superpower (mexico especially) are such economic disasters.... and then one must wonder whether this is an accident.

Methinks the US is a nasty destructive country, and that Haiti and its gross poverty and failed government are american syle... and that Cuba, however "unfree" is happily not american style.

Until the US can show a track record for doing anything but fucking people over, it is a rather poor example to the world for anything but being degenerate, greedy and destrucive.

[Redwraith]

2. Well ...

Those tariffs are not protectionist. they are a penalty. they are not there to protect lets say the European steel market (bells ringing ?) against the US Steel market.

They are the equivalent to being put into prison.

Plus they are allowed by the WTO which protectionist tariffs never would be (as it was the case with the US steel tariffs)

Plus the US had months to stop those tax breaks, but the US administration never did.

So those penalty tariffs are perfectly ok.

but that is just my opinion.

[denverbill]

4. The effect is the same, regardless of the name.

Protectionist/punative tariffs both increase the price of imported goods and effectively protect domestic producers against unfair price competition.

It's no different from the US imposing a tariff on imported Chinese textiles, when those textiles are either subsidized by the Chinese govt or produced using slave labor.

[newyawker99]

6. Hi Redwraith!!

Welcome to DU!! :toast: