The US has followed the EU by lodging a complaint with the World Trade Organisation (WTO) against tariffs on imported spirits in the Philippines.

US trade officials have requested a WTO consultation with the Philippines on what they describe as discriminatory taxes on imported spirits.

Consultation is the first stage of the WTO dispute process. EU negotiators held consultations with the Philippines on the same issue last October, but have since moved to arbitration after failing to secure a breakthrough.

"Although the US has raised this issue many times, the Philippines continues to tax distilled spirits from the US at much higher rates than distilled spirits produced in the Philippines," said US trade representative Ron Kirk yesterday (14 January).
Imported spirits are taxed between ten and 40 times more than domestically produced spirits, the US alleges.

WTO rules forbid any member state from taxing imported spirits differently from domestic products.

Distillers have welcomed the US move. "These exorbitant taxes have made it nearly impossible for US spirits exporters to break into the US$3bn Philippines spirits market," said Peter Cressy, president of the US Distilled Spirits Council (Discus).

US spirits exports to the Philippines were valued at $671,000 in calendar 2008, Discus said. The US exports more than $1bn of spirits globally per year.

EU spirits exports to the Philippines halved from EUR37m (US$54m) to EUR18m between 2004 and 2007, according to the European Commission.