Gulf Co-operation Council Agrees Uniform Customs Tariff

by Lorys Charalambous, Tax-news.com, Cyprus

07 January 2002

At its annual summit in Muscat, reports the Middle Eastern Economic Digest, the supreme council of the Gulf Co-operation Council (GCC) approved a new unified economic agreement which will accelerate the introduction of a regional customs union. Uniform standards and specifications for manufactured goods and a single regional quarantine system are to be introduced by the end of 2002, the supreme council agreed.

'The council studied the steps taken for the establishment of the GCC customs union, and decided to reduce the unified customs tariffs to 5 per cent on all imported goods by 1 January 2003,' reads the final communique of the two-day summit, issued on 31 December. Those goods listed in 1999 as exempt from import tax will continue to be so, and certain industrial installations will also have their production imports exempt from the new tariff regime.

The EU is the GCC's main trading partner but attempts to build a trade accord have foundered on disparate import tariffs in the Gulf and a long-running dispute over the 6% import duty imposed by the EU on primary aluminium.

Coinciding with the issue of the euro into general circulation, GCC leaders also approved proposals for monetary union and the introduction of a single GCC currency by 2010.

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