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The minutes of a meeting of the World Trade Organization and diplomatic sources report that the European Union, Switzerland and the United States have filed complaints with the company. 39 World Trade Organization (WTO) on taxes imposed by the Gulf States.
The WTO meeting notes, held on July 3 and 4, showed that he was asking Saudi Arabia, the United Arab Emirates, and Bahrain to explain the reasons a tax of 100% on energy drinks and 50% on other soft drinks.
The tax was imposed in 2017 after the governments of the oil exporting region were under financial pressure as a result of the sharp decline in oil prices. The Gulf states said the tax was aimed at diversifying income sources and improving healthy lifestyles in countries with high rates of obesity and diabetes.
A trade official in Geneva told Reuters that the United States had called on the three countries to cancel the tax and urged other Gulf countries not to apply it, while Switzerland asked the finance ministers of these countries to study this change. A source from the European Union and two Gulf diplomats declare that the European Union does not oppose the idea of taxation, but believes that there is discrimination because of the calculation of the tax based on the retail price and not on non-carbonated drinks.
A European diplomat, speaking on condition of anonymity, said: "There is absolutely no logic from the point of view of health."
The EU source added that the EU would consider seeking formal consultations within the organization, if it fails to settle the tax issue, by the through bilateral negotiations.
The soft-drink market in the Gulf, which also includes Qatar, Kuwait, and Oman, was $ 8.4 billion last year, according to Euromontur Market Research. Taxes hit companies, including Coca-Cola, Pepsi and Red Bull.
No comments were made by officials in Saudi Arabia, the United Arab Emirates, Bahrain or in the European Union.
According to the minutes of the meeting published on the website of the organization, the tax imposed in Saudi Arabia aims to protect human health and the environment, and not to protect the environment. 39, local industry.
A source from the Union said that Bahrain had indicated that the three countries were ready to hold bilateral consultations.
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