The Spanish government’s negotiations with the Biden administration succeeded in removing nine products from the list penalized by the United States.
Following the official announcement of the decision of the United States Trade Representative (USTR), Katherine Tai, to impose additional tariffs of 25% on a range of Spanish products, as well as the immediate suspension of their application for a 180-day period, the Spanish government reports that this announcement marks the end of the one-year Section 301 digital service tax investigations adopted by Austria, India, Italy, the ‘Spain, Turkey and the United Kingdom. The report was released in January and concluded that the taxes unfairly target U.S. digital businesses and cause damage to the U.S. economy, and recommended imposing additional tariffs on certain products from those countries.
In March 2021, the USTR announced the proposed trade measures in these six investigations and undertook a public hearing and comment process, during which it gathered hundreds of comments and held seven public hearings.
During the investigation, the Spanish government has repeatedly emphasized that the tax on certain digital services in Spain was designed to be proportionate, neutral and non-discriminatory. In addition, its temporary nature is explicitly indicated in the text of the law itself and it has been recalled on several occasions that as soon as there is a multilateral agreement within the framework of the OECD, the process of replacing this tax with the overall solution will begin. .
Since the publication, the Second Vice President and the Ministers of Industry, Trade and Tourism and Foreign Affairs, European Union and Cooperation have been in contact with their counterparts to convey to the United States government their their dissatisfaction with the possible imposition of measures and express their willingness to cooperate and work together to reach an agreement in the international tax negotiations taking place at the OECD.
Representatives of the Secretary of State for Commerce held several meetings and contacts with sectors that could be affected if the measures were implemented and the Minister of Industry, Trade and Tourism met with representatives of the footwear sector in Alicante, one of the most affected sectors. – Gather first-hand information about the issues, which she then passed on to the US Trade Representative by letter.
The Minister of Industry, Trade and Tourism welcomes the fact that the United States has suspended the application of customs duties and is convinced that the suspension will be final, because she has seen first-hand the smooth progress of the negotiations during his visit to the OECD last week to inquire about the state of negotiations.
It also welcomes the fact that, compared to the list submitted to the public hearing and published on March 26, 9 of the 36 items initially proposed have been deleted, including some items of shoes, octopus, hats and caps, and a glassware tariff line.
The announcement of the immediate suspension confirms that “the United States remains committed to reaching consensus on international tax issues through the OECD processes, a commitment that the Spanish government also shares,” the minister said. .
Spain and the United States are working intensely within the OECD to reach agreement on a global tax architecture that fairly taxes intellectual property (IP) and digital profits. Full resolution is only possible as part of a broader global agreement on international taxation.
The value of trade in the tariff lines concerned is:
The following items were excluded from the list:
0307.51.00 â¦â¦â¦â¦. Octopus, live, fresh or chilled.
0307.59.01 â¦â¦â¦â¦. Octopus, dried, salted or in brine.
1605.55.60 â¦â¦â¦â¦. Octopus, prepared or preserved.
6403.59.15 â¦â¦â¦â¦. Footwear turned or turned with outer soles and uppers of leather, not covering the ankle.
6403.91.90 â¦â¦â¦â¦. Shoes with rubber / plastic / comp outsoles. leather and leather uppers, cov. ankle, n / welt, for persons other than men / youth / boys.
6403.99.60 â¦â¦â¦â¦. Shoes with rubber / plastic / comp outsoles. leather and leather uppers, n / cov. ankle, n / welt, for men, youth and boys, nes.
6505.00.04 â¦â¦â¦â¦. Fur felt hats and headwear made from hat shapes and hat bodies from 6501.
6505.00.60 â¦â¦â¦â¦. Hats and headgear, of man-made fibers, knitted or made from knitted or crocheted fabrics, not forming part of the braid.
7013.99.50 â¦â¦â¦â¦. Glassware for toilet / office / interior decor. or for similar purposes, nes, of a value exceeding $ 0.30 but not exceeding $ 3 each.