Group representing Diageo and Pernod Ricard says India’s bulk Scotch tariff exclusion goes against the India-UK deal.
India’s move to exclude bulk Scotch imports from a reduced 75% tariff goes against provisions agreed in an India-UK trade deal, a group representing liquor makers Diageo and Pernod Ricard said. In a letter to India’s commerce minister on Friday, the International Spirits and Wines Association of India said the classification issue risks undermining, in practice, an important market-access benefit negotiated and agreed between the two countries. Whisky tariffs were a sticking point before the deal’s July 15 implementation, with India agreeing to halve import taxes on certain Scotch imports from 150% to 75% immediately and to 40% over 10 years.
Indian investigators have privately told companies the reduced rate does not apply to bulk Scotch concentrates, creating the first significant dispute over the agreement since it took effect. India’s Directorate of Revenue Intelligence searched the offices of Pernod and Diageo and questioned executives this month as part of an investigation into whether they misclassified imported products to benefit from the reduced rate.
A British government spokesperson said the British government is working with the government of India to resolve the issue. The Scotch Whisky Association said on Saturday that upholding the core principles of the bilateral pact is vital.
Source: Reuters
