Philippines says to appeal WTO ruling on alcohol tax

MANILA, Aug 16 (Reuters) - The Philippine government will ask the World Trade Organisation (WTO) to revisit a ruling that declared a tax levied on spirits from the European Union and the United States in violation of the trade body's rules, a senior official said on Tuesday.

The WTO ruled on Monday that the Philippines' alcohol taxes discriminated against brands such as Jack Daniel's and Jim Beam as well as Spain's Brandy de Jerez, while favouring domestic producers in the archipelago's $3.4 billion spirits market.

"We will appeal the ruling," Trade Secretary Gregory Domingo told reporters via a mobile SMS message.

The European Union and the United States, the world's No. 1 and No. 2 exporters of distilled spirits, urged the Southeast Asian nation to quickly comply with the WTO ruling.

The WTO generally bars its members from discriminating between imported and domestic products in their tax regimes.

In separate cases filed at the WTO, Brussels and Washington complained the Philippines had violated global trade rules by taxing foreign alcoholic beverages at rates 10 to 40 times higher than brands made in the Philippines from home-grown materials such as sugar and palm.

The ruling is expected to help U.S. producers like Brown-Forman (BFb.N: Quote, Profile, Research, Stock Buzz), owner of the Jack Daniel's brands, and Fortune Brands , makers of Jim Beam whiskey, break into the Philippines' spirits market.

The United States had brought two legal claims against the Philippines' measures, and prevailed on both, the U.S. Trade representative said.

Mon, Aug 15 2011

By Rosemarie Francisco;

Editing by Alex Richardson

Source: reuters.com