less than 280 U.A. per 100 kilograms, 23 percent but 

 not less than 28 U.A. and not more than 33 U.A. per 

 100 kilograms. (2) For leaf valued at 280 U.A. per 

 100 kilograms or more, 15 percent but not more than 

 70 U.A. per 100 kilograms. 



These tariffs are paid in the currencies of each of 

 the member countries. For example, a German 

 tobacco importer would pay the tariff at the rate of 

 3.66 Deutschmarks per unit of account, the official 

 rate of exchange between Deutschmarks and units of 

 account. The tariffs may then be converted to U.S. 

 dollar equivalent at the market rate for converting 

 Deutschmarks to dollars (approximately 3.22 

 Deutschmarks per doUar for early 1973). The dollar 

 equivalent of .this tariff for a German importer then 

 would be: (1) For leaf valued at less than US$1.44 

 per pound, 23 percent but not less than 14 U.S. cents 

 per pound and not more than 17 U.S. cents per 

 pound. (2) For leaf valued at US$1.44 per pound or 

 more, 15 percent but not more than 36 U.S. cents per 

 pound. The dollar equivalents of the tariff for other 

 members of the EC-6 are shown in Table 2, Ap- 

 pendix C. As of January 1973, official rates for 

 converting units of account to the currencies of the 

 tliree apphcants had not been established. 



The schedule for adoption of the CXT by the 

 applicants and the zero internal tariff is as fol- 

 lows: The CXT will be adopted for both leaf and 

 products by eliminating, on January 1, 1974, 40 

 percent of the difference between the present duty 

 and the CXT. An additional 20 percent will be 

 eUminated January 1, 1975; another 20 percent 

 January 1, 1976, and the final 20 percent July 1, 

 1977. The tariff on imports from other members will 

 be reduced to zero by eUminating 20 percent of the 

 tariff on July 1, 1973, for leaf tobacco, and on 

 April 1, 1973, for tobacco products. The balance of 

 the tariff for both leaf and products wiU be elim- 

 inated in steps of 20 percent each on January 1, of 

 1974, 1975, and 1976, and July 1, 1977. 



This is illustrated in tabular form as foUows: 





Schedule for 



Schedule for 





eliminating 



eliminating 



- 



difference 



present tariff 



Date 



between 



present tariff 



and CXT' 







Leaf 



Products 





Percent 



Percent Percent 



April 1,1973. . 



-- 



-20 



July 1, 1973 . . 



-- 



-20 



Jan. 1, 1974 . . 



-40 



-20 -20 



Jan. 1, 1975 . . 



-20 



-20 -20 



Jan. 1, 1976 . . 



-20 



-20 -20 



July 1, 1977 . . 



-20 



-20 -20 



The United Kingdom will follow this schedule 

 both for leaf tobacco and tobacco products. The 

 United Kingdom will phase in the zero duty on leaf 

 imports from Greece and Turkey at the same time it 

 phases in the zero duty from other EC countries. 

 Tobacco from some Commonwealth countries (Ap- 

 pendix A) began entering the United Kingdom duty 

 free on January 1, 1973. Some other Commonwealth 

 countries and some countries receiving Common- 

 wealth preferences will be treated as third countries 

 by the United Kingdom and the CXT will be 

 harmonized for them according to the above sched- 

 ule. (See section on the United Kingdom.) 



Ireland changed its revenue or "customs duty" on 

 leaf tobacco to an' excise tax January 1, 1973. For 

 harmonization purposes, Ireland wiU have near zero 

 duty from that date.^ Ireland will phase its near zero 

 or US$0.0048 per pound duty to zero for leaf 

 tobacco imports from the EC and, probably, from 

 countries whose leaf tobacco now enters the EC duty 

 free. Otherwise Ireland will foHow the schedule for 

 phasing its near zero duty to the CXT for leaf imports 

 from outside the EC and EC preference area and for 

 adopting the CXT for tobacco products. 



Denmark, prior to becoming an EC member, had 

 no duty on leaf imports from any source. Denmark 

 will continue from January 1, 1973, with zero duty 

 on leaf tobacco imports from the EC and probably 

 from those countries whose leaf tobacco enters the 

 EC duty free. Denmark also has zero duty on tobacco 

 product imports from European Free Trade Associa- 

 tion (EFTA) countries. This will continue in effect 

 for the United Kingdom. But Denmark will adopt the 

 CXT for leaf and product imports from outside the 

 EC and EC preference area and will graduaUy reduce 

 its duty on tobacco products to zero for other EC 

 members. 



Preferences 



The EC-6 countries presently grant duty-free 

 treatment to unmanufactured tobacco imports from 

 Greece, Turkey, 18 Associated African States 

 (Yaounde Agreement), and three countries of the 

 Arusha Convention (Appendix B). Preferential duty 

 treatment is also given to leaf tobacco and tobacco 

 product imports from a number of minor producers 

 such as Algeria and the Associated Overseas States 

 and Territories (St. Pierre, and Miquelon, Comoran 



Bath leaf and products. 



The "duty" is actually the difference between the 

 preferential rate on imports from the United Kingdom 

 and the most-favored-nation (MFN) rate. This difference is 

 only Irish £0.002 or US$0.0048 per pound for stemmed to- 

 bacco and zero for unstemmed tobacco. The former duty 

 was £4.416 for unstemmed leaf from all sources and £4.416 

 for stemmed leaf from the United Kingdom and Northern 

 Ireland and £4.418 for stemmed leaf from other MFN 



