29 Jul 2019

To tax or not to tax: imported steel back before the courts

4:49 pm on 29 July 2019

A decision on whether or not to charge China for steel imported into New Zealand is going back before the courts.

Last year the High Court quashed a decision not to impose taxes on the steel, but the Ministry of Business Innovation and Employment (MBIE), which made the original decision, will challenge this.

In 2016 New Zealand Steel asked MBIE to investigate whether it was necessary to impose countervailing duties on China over imported galvanised steel coil.

Duties can be applied if imports are being subsidised by the exporting country's government to such a degree that it undercuts the importing country's market.

In 2017 the Ministry found there was a small amount of subsidisation but it was [https://www.rnz.co.nz/news/national/334887/chinese-steel-subsidies-found-to-be-minimal

not damaging the market] so did not seek to impose duties, however, a judicial review quashed this decision because there were errors in the advice given to the Minister.

A May 2019 briefing to the Minister of Commerce and Consumer Affairs Kris Faafoi confirmed MBIE was reconsidering as directed, but would also appeal the Court's ruling in November.

The reconsidered decision was released by Mr Faafoi earlier this month and maintains that the imported steel had only been subsidised by a small amount and the subsidies were not causing material injury to the domestic industry.

Read about the decision here.

MBIE said it would not be commenting on its decision to appeal while the case was before the courts.

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