Business

Rice tariff 778% with new WTO formula

Japan’s tariff on milled rice imports is 778 percent under a new formula for global trade talks, up sharply from the earlier-published 490 percent, sources said Thursday.

The new figure, calculated for the ongoing trade liberalization talks under the World Trade Organization, could enhance the view that Tokyo protects its farm products with very high tariffs, analysts say.

The new formula for WTO farm trade liberalization talks requires unit-based tariffs to be recalculated into ad valorem tariffs for a progressive tariff reduction proposal, which subjects higher tariff rates to deeper cuts.

The current unit-based tariff on rice is 341 yen per kg. On an ad valorem basis, a tariff is inflated as the base import price declines.

The earlier-published rate of 490 percent on an ad valorem basis was based on 1996-98 import prices.

Import prices have declined with even lower international prices taken into account under the new formula, resulting in the far higher estimate of 778 percent, the sources said.