Proposed Action in Section 301 Investigation of India's Digital Services Tax, 16824-16828 [2021-06627]
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16824
Federal Register / Vol. 86, No. 60 / Wednesday, March 31, 2021 / Notices
HTSUS subheading
Product description
5701.10.16 .............
Carpets & other textile floor coverings, hand-knotted or hand-inserted, w/ov 50% by weight of the pile of fine animal hair,
nesoi.
Carpets and other textile floor coverings, of wool or fine animal hair, hand-hooked (tufts were inserted and knotted by
hand or hand tool).
Carpets and other textile floor coverings, of wool or fine animal hair, not hand-hooked, not hand knotted during weaving.
Carpet and other textile floor covering, knotted, of text. materials (not wool/hair) nesoi, pile inserted & knotted during
weaving or knitting.
Kelem, Schumacks, Karamanie and similar hand-woven rugs, other than certified hand-loomed and folklore products.
Wilton, velvet and like floor coverings of pile construction, woven, not tufted or flocked, not made up, of wool or fine animal hair.
Carpets and other textile floor coverings of pile construction, woven, not tufted or flocked, not made up, of wool/fine animal
hair, nesoi.
Wilton, velvet and like floor coverings of pile construction, woven, not tufted or flocked, made up, of man-made textile materials.
Carpets not other textile floor coverings of pile construction, woven, not tufted or flocked, made up, of cotton.
Hand-loomed carpet & other textile floor coverings, not of pile construction, woven, made up, of man-made textile materials, nesoi.
Carpet & other textile floor coverings, not of pile construction, woven, made up, of man-made textile materials, nesoi.
Hand-loomed carpets and other textile floor coverings, not of pile construction, woven, made up, of cotton.
Carpets and other textile floor coverings, not of pile construction, woven, made up, of cotton, nesoi.
Carpets and other textile floor coverings, tufted, whether or not made up, of nylon or other polyamides, nesoi.
Carpets & other textile floor coverings, tufted, whether or not made up, of man-made textile materials (not nylon/other
polyamides), nesoi.
Carpets and other textile floor coverings, tufted, whether or not made up, of other textile materials nesoi.
Bed linen, not knitted or crocheted, printed, of manmade fibers, nesoi.
Bed linen, not knitted or crocheted, not printed, of manmade fibers, nesoi.
Curtains (including drapes), interior blinds and valances of cotton, not knitted or crocheted.
Tiles/cubes/similar arts. of natural stone, enclosable in a sq. w/a side less than 7 cm; artificially colored granules, chippings & powder.
Monumental or building stone & arts. thereof, of travertine, simply cut/sawn, w/flat or even surface.
Monumental or building stone & arts. thereof, of marble & alabaster, simply cut/sawn, w/flat or even surface.
Monumental or building stone & arts. thereof, of calcareous stone, nesoi, further worked than simply cut/sawn, nesoi.
Unglazed ceramic tiles, other than those of subheading 6907.30 and 6907.40, of H2O absorp coeff by wt <=0.5%.
Glazed ceramic tiles having surface area >=38.7cm2, , surf area in sq w/side <7cm, of a H2O absorp coeff by wt <=0.5%.
Glazed ceramic tiles nesoi, of a H2O absorp coeff by wt <=0.5%.
Glazed ceramic tiles nesoi, of a H2O absorp coeff by wt >10%.
Glazed ceramic mosaic cubes having <=3229 tiles per m2, surf area in sq w/side <7cm.
Glazed ceramic mosaic cubes having surface area <38.7cm2, surf area in sq w/side <7cm.
Glazed ceramic mosaic cubes nesoi, o/t subheading 6907.40.
Glazed finishing ceramics nesoi.
Porcelain or china ceramic sinks, washbasins, baths, bidets, water closet bowls, urinals & siml. sanitary fixtures.
Ceramic (o/than porcelain or china) sinks, washbasins, baths, bidets, water closet bowls, urinals & siml. sanitary fixtures.
Porcelain or china (o/than bone china) statuettes and other ornamental articles, nesoi.
Ceramic (o/than porcelain, china or earthenware) ornamental articles, nesoi.
Silver articles of jewelry and parts thereof, nesoi, valued not over $18 per dozen pieces or parts.
Silver articles of jewelry and parts thereof, nesoi, valued over $18 per dozen pieces or parts.
Gold mixed link necklaces and neck chains.
Precious metal (o/than silver) clasps and parts thereof.
Precious metal (o/than silver) articles of jewelry and parts thereo, whether or not plated or clad with precious metal, nesoi.
Base metal clad w/gold necklaces and neck chains, nesoi.
Base metal clad w/precious metal articles of jewelry and parts thereof, nesoi.
Jewelry articles of precious or semiprecious stones, valued not over $40 per piece.
Imitation jewelry (o/than toy jewelry & rope, curb, cable, chain, etc.), of base metal (wheth. or n/plated w/prec.metal),
nesoi.
Imitation jewelry not of base metal or plastics, nesoi, over 20 cents/dozen pcs or pts.
5701.10.40 .............
5701.10.90 .............
5701.90.10 .............
5702.10.90 .............
5702.31.10 .............
5702.31.20 .............
5702.42.10 .............
5702.49.10 .............
5702.92.10 .............
5702.92.90
5702.99.05
5702.99.15
5703.20.20
5703.30.80
.............
.............
.............
.............
.............
5703.90.00
6302.22.20
6302.32.20
6303.91.00
6802.10.00
.............
.............
.............
.............
.............
6802.21.10
6802.21.50
6802.92.00
6907.21.10
6907.21.40
6907.21.90
6907.23.90
6907.30.20
6907.30.30
6907.30.90
6907.40.90
6910.10.00
6910.90.00
6913.10.50
6913.90.50
7113.11.20
7113.11.50
7113.19.25
7113.19.30
7113.19.50
7113.20.29
7113.20.50
7116.20.05
7117.19.90
.............
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7117.90.90 .............
Request for comments and
notice of public hearing.
ACTION:
[FR Doc. 2021–06626 Filed 3–30–21; 8:45 am]
BILLING CODE 3290–F1–P
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[Docket Number USTR–2021–0003]
Proposed Action in Section 301
Investigation of India’s Digital Services
Tax
Office of the United States
Trade Representative.
AGENCY:
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The Office of the United
States Trade Representative (USTR)
requests written comments regarding a
potential trade action in connection
with the Section 301 investigation of
India’s Digital Services Tax (DST).
USTR also will convene virtual public
hearings and accept rebuttal comments
in relation to the potential action.
SUMMARY:
OFFICE OF THE UNITED STATES
TRADE REPRESENTATIVE
DATES:
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April 21, 2021: To be assured of
consideration, submit requests to appear
at a hearing, along with a summary of
the testimony, by this date.
April 30, 2021: To be assured of
consideration, submit written comments
by this date.
May 3, 2021: Multi-jurisdictional
virtual hearing on proposed actions.
May 10, 2021: To be assured of
consideration, submit multijurisdictional hearing rebuttal
comments by this date.
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Federal Register / Vol. 86, No. 60 / Wednesday, March 31, 2021 / Notices
May 10, 2021 at 9:30 a.m.: Virtual
hearing on India DST proposed action.
May 17, 2021: To be assured of
consideration, submit India DST hearing
rebuttal comments by this date.
ADDRESSES: Submit documents in
response to this notice, including
written comments and hearing
appearance requests, through the online
USTR portal: https://
comments.ustr.gov/s/.
FOR FURTHER INFORMATION CONTACT: For
questions concerning the investigation,
please contact Ben Allen or Patrick
Childress, Assistant General Counsels at
(202) 395–9439 and (202) 395–9531,
respectively; Robert Tanner, Director,
Services and Investment at (202) 395–
6125; or Brendan Lynch, Deputy
Assistant U.S. Trade Representative for
South and Central Asian Affairs at (202)
395–2851. For issues with on-line
submissions, please contact the USTR
Section 301 line at (202) 395–5725.
SUPPLEMENTARY INFORMATION:
Based on information obtained during
the investigation, USTR prepared a
comprehensive report on India’s DST
(India DST Report). The India DST
Report is posted on the USTR website
at https://ustr.gov/issue-areas/
enforcement/section-301-investigations/
section-301-digital-services-taxes. The
report includes a full description of
India’s DST, and supports findings that
India’s DST is unreasonable and
discriminatory and burdens or restricts
U.S commerce.
On January 6, 2021, based on the
information obtained during the
investigation and the advice of the
Section 301 Committee, the U.S. Trade
Representative determined that India’s
DST is unreasonable or discriminatory
and burdens or restricts U.S. commerce,
and therefore is actionable under
sections 301(b) and 304(a) of the Trade
Act (19 U.S.C. 2411(b) and 2414(a)). See
86 FR 2478 (January 12, 2021).
I. Proceedings in the Investigation
Section 301(b) provides that upon
determining that the acts, policies, and
practices under investigation are
actionable and that action is
appropriate, the U.S. Trade
Representative shall take all appropriate
and feasible action authorized under
section 301(c), subject to the specific
direction, if any, of the President
regarding such action, and all other
appropriate and feasible action within
the power of the President that the
President may direct the U.S. Trade
Representative to take under section
301(b), to obtain the elimination of that
act, policy, or practice.
Section 301(c)(1)(B) of the Trade Act
authorizes the U.S. Trade
Representative to impose duties on the
goods of the foreign country subject to
the investigation. Pursuant to sections
301(b) and (c), USTR proposes that the
U.S. Trade Representative should
determine that action is appropriate and
that appropriate action would include
the imposition of additional ad valorem
tariffs on certain products of India.
In particular, USTR proposes to
impose additional tariffs of up to 25
percent ad valorem on an aggregate
level of trade that would collect duties
on goods of India in the range of the
amount of DST that India is expected to
collect from U.S. companies. Initial
estimates indicate that the value of the
DST payable by U.S.-based company
groups to India will be up to
approximately $55 million per year.
USTR further proposes that the goods
of India subject to additional tariffs
would be drawn from the preliminary
list of products in the Annex to this
India has adopted a DST that imposes
a two percent tax on revenue generated
from a broad range of digital services
offered in India, including digital
platform services, digital content sales,
digital sales of a company’s own goods,
data-related services, software-as-aservice, and several other categories of
digital services. India’s DST only
applies to ‘‘non-resident’’ companies.
On June 2, 2020, the U.S. Trade
Representative initiated an investigation
of India’s DST pursuant to section
302(b)(1)(A) of the Trade Act of 1974, as
amended (Trade Act). See 85 FR 34709
(June 5, 2020) (notice of initiation). The
notice of initiation solicited written
comments on, inter alia, the following
aspects of India’s DST: Discrimination
against U.S. companies; retroactivity;
and possibly unreasonable tax policy.
With respect to tax policy, USTR
solicited comments on, inter alia,
whether the DST diverged from
principles reflected in the U.S. and
international tax systems including
extraterritoriality; taxing revenue not
income; and a purpose of penalizing
particular technology companies for
their commercial success. Interested
persons filed over 380 written
submissions in response. The public
submissions are available on
www.regulations.gov in docket number
USTR–2020–0022.
Under section 303 of the Trade Act,
the U.S. Trade Representative requested
consultations with the government of
India regarding the issues involved in
the investigation. Consultations were
held on November 5, 2020.
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II. Proposed Action
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16825
notice, as specified by the listed eightdigit tariff subheadings.
III. Request for Public Comments
In accordance with section 304(b) of
the Trade Act (19 U.S.C. 2414(b)), USTR
invites comments from interested
persons with respect to whether action
is appropriate, and if so, the appropriate
action to be taken.
USTR requests comments with
respect to any issue related to the action
to be taken in this investigation. With
respect to the proposed tariff action
outlined above, USTR specifically
invites comments regarding:
• The level of the burden or
restriction on U.S. commerce resulting
from India’s DST, including the amount
of DST payments owed by U.S.
companies, the annual growth rate of
such payments, and other effects, such
as compliance costs.
• The appropriate aggregate level of
trade to be covered by additional duties.
• The level of the increase, if any, in
the rate of duty.
• The specific products to be subject
to increased duties, including whether
the tariff subheadings listed in the
Annex should be retained or removed,
or whether tariff subheadings not
currently on the list should be added.
In commenting on the inclusion or
removal of particular products on the
preliminary list of products subject to
the proposed additional duties, USTR
requests that commenters specifically
address whether imposing increased
duties on a particular product would be
practicable or effective to obtain the
elimination of India’s acts, policies, and
practices, and whether imposing
additional duties on a particular
product would cause disproportionate
economic harm to U.S. interests,
including small- or medium-size
businesses and consumers.
Simultaneously with this notice,
USTR also is requesting public
comments on proposed trade actions in
five other DST investigations initiated at
the same time as the India DST
investigation. Certain interested persons
may wish to provide written comments
or oral testimony on multi-jurisdictional
issues common to two or more
investigations. To avoid duplication, the
USTR portal will have a separate docket
for multi-jurisdictional submissions,
and USTR will hold a separate multijurisdictional hearing.
To be assured of consideration, you
must submit written comments on the
proposed action by April 30, 2021, and
post-hearing rebuttal comments by May
10, 2021 for the multi-jurisdictional
hearing, and by May 17, 2021 for the
India DST hearing.
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Federal Register / Vol. 86, No. 60 / Wednesday, March 31, 2021 / Notices
IV. Hearing Participation
The Section 301 Committee will
convene a virtual public hearing for
comments pertaining to the India DST
proposed action on May 10, 2021,
beginning at 9:30 a.m. Those requesting
to appear at this hearing should have
comments applicable only to the India
DST proposed action.
The Section 301 Committee will
convene a virtual public hearing for
comments pertaining to multiple
jurisdictions on May 3, 2021, beginning
at 9:30 a.m. Those requesting to appear
at the multi-jurisdictional hearing
should have comments that are
applicable to two or more DST
investigations.
For either hearing, you must submit a
request to appear at the specific hearing
using the electronic portal at https://
comments.ustr.gov/s/. You will be able
to view a docket entitled ‘Request to
Appear at Hearing on Proposed Action
in Section 301 Investigation of India’s
Digital Services Tax.’ Requests to appear
must include a summary of testimony,
and may be accompanied by a prehearing submission. Remarks at the
hearing are limited to five minutes to
allow for possible questions from the
Section 301 Committee. All submissions
must be in English. To be assured of
consideration, USTR must receive your
request to appear by April 21, 2021.
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V. Procedures for Written Submissions
You must submit written comments,
rebuttal comments, and requests to
appear at the hearing using the
electronic portal at https://
comments.ustr.gov/s. You will be able to
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view a docket entitled ‘Comments
Concerning Proposed Action in Section
301 Investigation of India’s Digital
Services Tax’ on the portal, docket
number USTR–2021–0003.
You do not need to establish an
account to submit comments. Fields
with a gray (BCI) notation are for
Business Confidential Information and
the information entered will not be
publicly available. Required fields are
marked ‘Required’ and will have a red
asterisk (*). Fields with a green (Public)
notation will be viewable by the public.
The first screen of the portal requires
you to enter identification and contact
information. Third party organizations
such as law firms, trade associations, or
customs brokers should identify the full
legal name of the organization they
represent, and identify the primary
point of contact for the submission. The
remaining fields of the form are
optional.
After entering the identification and
contact information, you can complete
the remainder of the questionnaire, or
any portion of it by clicking ‘Next.’ You
can comment on multiple products in a
single entry, or submit multiple
comments. You will be able to navigate
through each screen of the form by
clicking ‘Next,’ with or without entering
a response to each field on an
individual screen or page. Additionally,
you will be able to upload documents at
the end of the form and designate
whether USTR should treat the
documents as business confidential or
public information.
For uploads containing BCI, the file
name of the business confidential
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version should begin with the characters
‘BCI’. Any page containing BCI must be
clearly marked ‘BUSINESS
CONFIDENTIAL’ on the top of that page
and the submission should clearly
indicate, via brackets, highlighting, or
other means, the specific information
that is BCI. If you request business
confidential treatment, you must certify
in writing that disclosure of the
information would endanger trade
secrets or profitability, and that the
information would not customarily be
released to the public. Parties uploading
attachments containing BCI also must
submit a public version of their
comments. The file name of the public
version, which must be uploaded on
https://comments.ustr.gov/s/, should
begin with the character ‘P’. The ‘BCI’
and ‘P’ should be followed by the name
of the person or entity submitting the
comments or rebuttal comments. If these
procedures are not sufficient to protect
BCI or otherwise protect business
interests, please contact the USTR
Section Hotline 301 line at (202) 395–
5725 to discuss whether alternative
arrangements are possible. USTR will
post attachments uploaded to the docket
for public inspection, except for
attachments marked as business
confidential.
You can view all public submissions
on the USTR portal at https://
comments.ustr.gov/s.
Greta Peisch,
General Counsel, Office of the United States
Trade Representative.
BILLING CODE 3290–F1–P
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16827
Annex
Note: All products that are classified in the eight-digit subheadings of the Harmonized
Tariff Schedule of the United States (HTSUS) that are listed in this Annex are covered by
the proposed action. The product descriptions that are contained in this Annex are
provided for informational purposes only, and are not intended to delimit in any way the
scope of the proposed action. Any questions regarding the scope of a particular HT SUS
subheading should be referred to U.S. Customs and Border Protection. In the product
descriptions, the abbreviation "nesoi" means "not elsewhere specified or included".
Product Description
HTSUS Subheading
0306.16.00 .............. . Cold-water shrimps and prawns, cooked in shell or uncooked, dried,
salted or in brine, frozen
Cold water shrimps and prawns, shell-on or peeled, live, frozen, or
0306.35.00
chilled
Other shrimps and prawns, shell-on or peeled
0306.95.00
Basmati rice, husked
1006.20.20
Blinds, shutters, screens and shades of bamboo, with wooden frames
4421.91.40
w/o fixed louver boards or slats in the center
Edge-glued lumber of bamboo
Other articles, nesoi, of bamboo, incl pencil slats, burial caskets,
gates for confining children or pets
Other articles, nesoi, of wood other than of bamboo, incl pencil slats,
burial caskets, gates for confining children or pets,
4421.91.94
4421.91.97
4421.99.97
4503.10.40
Corks and stoppers of natural cork, tapered & of a thickness (or
length) greater than the maximum diam., over 19 mm maximum
diam., nesoi
4813.10.00
4813.90.00
5109.90.90
Cigarette paper in the form of booklets or tubes
Cigarette paper, whether or not cut to size, nesoi
Yarn of wool nesoi, or fine animal hair nesoi, < 85% of that
wool/hair, put up for retail sale, nesoi
6212.10.50 ...............
Brassieres containing lace, net or embroidery, containing under 70%
by weight of silk or silk waste, whether or not knitted or crocheted
7101.22.30 ...............
Cultured pearls, worked, graded and temporarily strung for
convenience of transport
7101.22.60 ...............
7103.99.50 ...............
Cultured pearls, worked, not strung, mounted or set
Precious or semiprecious stones, nesoi, worked, whether or not
graded, but n/strung (ex. ungraded temporarily strung), mtd. or set
Synth. or reconstruct. precious or semiprecious stones, wkd, whether
or not graded, but n/strung (ex. ungraded temp. strung), mtd./set,
nes01
Silver powder
Silver articles of jewelry and parts thereof, nesoi, valued not over $18
per dozen pieces or parts
...............
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7106.10.00 ...............
7113.11.20 ...............
Gold rope necklaces and neck chains
Gold mixed link necklaces and neck chains
7113.19.21
7113.19.25
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Federal Register / Vol. 86, No. 60 / Wednesday, March 31, 2021 / Notices
7114.20.00 ...............
7116.20.05
...............
7116.20.15
...............
7116.20.30 ...............
7116.20.35
7116.20.40
...............
...............
7116.20.50 ...............
7410.21.30 ...............
7504.00.00
9401.69.20
9401.69.40
9401.69.60
9401.69.80
9403.50.40
9403.50.90
9403.83.00
9504.30.00
Base metal clad w/gold mixed link necklaces and neck chains
Base metal clad w/precious metal articles of jewelry and parts
thereof, nesoi
Goldsmiths' or silversmiths' wares of base metal clad with precious
metal
Jewelry articles of precious or semiprecious stones, valued not over
$40 per piece
Jewelry articles of precious or semiprecious stones, valued over $40
per piece
Semiprecious stones (except rock crystal), graded and strung
temporarily for convenience of transport
Semiprecious stone (except rock crystal) figurines
Semiprecious stone (except rock crystal) articles (other than jewelry
and figurines)
Precious stone articles, nesoi
Refined copper, clad laminates, w/thickness of 0.15 mm or less,
backed
Nickel, powders and flakes
Seats nesoi, of bent-wood
Chairs nesoi, w/teak frames, not upholstered
Chairs nesoi, w/wooden frames (o/than teak), not upholstered
Seats (o/than chairs) nesoi, w/wooden frames, not upholstered
Furniture (o/than seats) of bentwood nesoi, of a kind used in the
bedroom
Furniture (o/than seats) of wood (o/than bentwood), of a kind used in
the bedroom & not designed for motor vehicle use
Rattan furniture and parts
Coin- or token-operated games for arcade, table or parlor (o/than
bowling alley equipment) nesoi and parts and accessories thereof
Indonesia because these jurisdictions
either have not adopted or not
implemented a DST during the period of
investigation.
[FR Doc. 2021–06627 Filed 3–30–21; 8:45 am]
BILLING CODE 3290–F1–C
OFFICE OF THE UNITED STATES
TRADE REPRESENTATIVE
Termination of Section 301 Digital
Services Tax Investigations of Brazil,
the Czech Republic, the European
Union, and Indonesia
Office of the United States
Trade Representative (USTR).
ACTION: Notice.
jbell on DSKJLSW7X2PROD with NOTICES
AGENCY:
The U.S. Trade
Representative is terminating the
Section 301 investigations of Digital
Services Taxes (DSTs) under
consideration by Brazil, the Czech
Republic, the European Union, and
SUMMARY:
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18:54 Mar 30, 2021
Jkt 253001
For
questions concerning the investigations,
please contact Benjamin Allen or
Patrick Childress, Assistant General
Counsels at (202) 395–9439 and (202)
395–9531, respectively; or Robert
Tanner, Director, Services and
Investment at (202) 395–6125. For
jurisdiction-specific questions, please
contact: Courtney Smothers, Deputy
Assistant U.S. Trade Representative for
Latin America at (202) 395–7657 (for
Brazil); Michael Rogers, Director,
Europe and the Middle East at (202)
395–2684 (for the Czech Republic and
the EU); or Bart Thanhauser, Director for
FOR FURTHER INFORMATION CONTACT:
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Southeast Asia and the Pacific at (202)
395–4088 (for Indonesia).
DATES: The Section 301 investigations of
DSTs under consideration by Brazil, the
Czech Republic, the European Union,
and Indonesia are terminated as of
March 26, 2021.
SUPPLEMENTARY INFORMATION: On June 2,
2020, the U.S. Trade Representative
initiated investigations pursuant to
section 302(b)(1)(A) of the Trade Act of
1974, as amended, of DSTs under
consideration by Brazil, the Czech
Republic, the European Union, and
Indonesia. 85 FR 34709 (June 5, 2020).
On January 13, 2021, USTR issued a
status update on these four
investigations: https://ustr.gov/sites/
default/files/files/Press/Releases/Status
Update301InvestigationsBEUIndCR.pdf.
The status update summarizes the DSTs
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7113.20.25 ...............
7113.20.50 ...............
Agencies
[Federal Register Volume 86, Number 60 (Wednesday, March 31, 2021)]
[Notices]
[Pages 16824-16828]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2021-06627]
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OFFICE OF THE UNITED STATES TRADE REPRESENTATIVE
[Docket Number USTR-2021-0003]
Proposed Action in Section 301 Investigation of India's Digital
Services Tax
AGENCY: Office of the United States Trade Representative.
ACTION: Request for comments and notice of public hearing.
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SUMMARY: The Office of the United States Trade Representative (USTR)
requests written comments regarding a potential trade action in
connection with the Section 301 investigation of India's Digital
Services Tax (DST). USTR also will convene virtual public hearings and
accept rebuttal comments in relation to the potential action.
DATES:
April 21, 2021: To be assured of consideration, submit requests to
appear at a hearing, along with a summary of the testimony, by this
date.
April 30, 2021: To be assured of consideration, submit written
comments by this date.
May 3, 2021: Multi-jurisdictional virtual hearing on proposed
actions.
May 10, 2021: To be assured of consideration, submit multi-
jurisdictional hearing rebuttal comments by this date.
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May 10, 2021 at 9:30 a.m.: Virtual hearing on India DST proposed
action.
May 17, 2021: To be assured of consideration, submit India DST
hearing rebuttal comments by this date.
ADDRESSES: Submit documents in response to this notice, including
written comments and hearing appearance requests, through the online
USTR portal: https://comments.ustr.gov/s/.
FOR FURTHER INFORMATION CONTACT: For questions concerning the
investigation, please contact Ben Allen or Patrick Childress, Assistant
General Counsels at (202) 395-9439 and (202) 395-9531, respectively;
Robert Tanner, Director, Services and Investment at (202) 395-6125; or
Brendan Lynch, Deputy Assistant U.S. Trade Representative for South and
Central Asian Affairs at (202) 395-2851. For issues with on-line
submissions, please contact the USTR Section 301 line at (202) 395-
5725.
SUPPLEMENTARY INFORMATION:
I. Proceedings in the Investigation
India has adopted a DST that imposes a two percent tax on revenue
generated from a broad range of digital services offered in India,
including digital platform services, digital content sales, digital
sales of a company's own goods, data-related services, software-as-a-
service, and several other categories of digital services. India's DST
only applies to ``non-resident'' companies.
On June 2, 2020, the U.S. Trade Representative initiated an
investigation of India's DST pursuant to section 302(b)(1)(A) of the
Trade Act of 1974, as amended (Trade Act). See 85 FR 34709 (June 5,
2020) (notice of initiation). The notice of initiation solicited
written comments on, inter alia, the following aspects of India's DST:
Discrimination against U.S. companies; retroactivity; and possibly
unreasonable tax policy. With respect to tax policy, USTR solicited
comments on, inter alia, whether the DST diverged from principles
reflected in the U.S. and international tax systems including
extraterritoriality; taxing revenue not income; and a purpose of
penalizing particular technology companies for their commercial
success. Interested persons filed over 380 written submissions in
response. The public submissions are available on www.regulations.gov
in docket number USTR-2020-0022.
Under section 303 of the Trade Act, the U.S. Trade Representative
requested consultations with the government of India regarding the
issues involved in the investigation. Consultations were held on
November 5, 2020.
Based on information obtained during the investigation, USTR
prepared a comprehensive report on India's DST (India DST Report). The
India DST Report is posted on the USTR website at https://ustr.gov/issue-areas/enforcement/section-301-investigations/section-301-digital-services-taxes. The report includes a full description of India's DST,
and supports findings that India's DST is unreasonable and
discriminatory and burdens or restricts U.S commerce.
On January 6, 2021, based on the information obtained during the
investigation and the advice of the Section 301 Committee, the U.S.
Trade Representative determined that India's DST is unreasonable or
discriminatory and burdens or restricts U.S. commerce, and therefore is
actionable under sections 301(b) and 304(a) of the Trade Act (19 U.S.C.
2411(b) and 2414(a)). See 86 FR 2478 (January 12, 2021).
II. Proposed Action
Section 301(b) provides that upon determining that the acts,
policies, and practices under investigation are actionable and that
action is appropriate, the U.S. Trade Representative shall take all
appropriate and feasible action authorized under section 301(c),
subject to the specific direction, if any, of the President regarding
such action, and all other appropriate and feasible action within the
power of the President that the President may direct the U.S. Trade
Representative to take under section 301(b), to obtain the elimination
of that act, policy, or practice.
Section 301(c)(1)(B) of the Trade Act authorizes the U.S. Trade
Representative to impose duties on the goods of the foreign country
subject to the investigation. Pursuant to sections 301(b) and (c), USTR
proposes that the U.S. Trade Representative should determine that
action is appropriate and that appropriate action would include the
imposition of additional ad valorem tariffs on certain products of
India.
In particular, USTR proposes to impose additional tariffs of up to
25 percent ad valorem on an aggregate level of trade that would collect
duties on goods of India in the range of the amount of DST that India
is expected to collect from U.S. companies. Initial estimates indicate
that the value of the DST payable by U.S.-based company groups to India
will be up to approximately $55 million per year.
USTR further proposes that the goods of India subject to additional
tariffs would be drawn from the preliminary list of products in the
Annex to this notice, as specified by the listed eight-digit tariff
subheadings.
III. Request for Public Comments
In accordance with section 304(b) of the Trade Act (19 U.S.C.
2414(b)), USTR invites comments from interested persons with respect to
whether action is appropriate, and if so, the appropriate action to be
taken.
USTR requests comments with respect to any issue related to the
action to be taken in this investigation. With respect to the proposed
tariff action outlined above, USTR specifically invites comments
regarding:
The level of the burden or restriction on U.S. commerce
resulting from India's DST, including the amount of DST payments owed
by U.S. companies, the annual growth rate of such payments, and other
effects, such as compliance costs.
The appropriate aggregate level of trade to be covered by
additional duties.
The level of the increase, if any, in the rate of duty.
The specific products to be subject to increased duties,
including whether the tariff subheadings listed in the Annex should be
retained or removed, or whether tariff subheadings not currently on the
list should be added.
In commenting on the inclusion or removal of particular products on
the preliminary list of products subject to the proposed additional
duties, USTR requests that commenters specifically address whether
imposing increased duties on a particular product would be practicable
or effective to obtain the elimination of India's acts, policies, and
practices, and whether imposing additional duties on a particular
product would cause disproportionate economic harm to U.S. interests,
including small- or medium-size businesses and consumers.
Simultaneously with this notice, USTR also is requesting public
comments on proposed trade actions in five other DST investigations
initiated at the same time as the India DST investigation. Certain
interested persons may wish to provide written comments or oral
testimony on multi-jurisdictional issues common to two or more
investigations. To avoid duplication, the USTR portal will have a
separate docket for multi-jurisdictional submissions, and USTR will
hold a separate multi-jurisdictional hearing.
To be assured of consideration, you must submit written comments on
the proposed action by April 30, 2021, and post-hearing rebuttal
comments by May 10, 2021 for the multi-jurisdictional hearing, and by
May 17, 2021 for the India DST hearing.
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IV. Hearing Participation
The Section 301 Committee will convene a virtual public hearing for
comments pertaining to the India DST proposed action on May 10, 2021,
beginning at 9:30 a.m. Those requesting to appear at this hearing
should have comments applicable only to the India DST proposed action.
The Section 301 Committee will convene a virtual public hearing for
comments pertaining to multiple jurisdictions on May 3, 2021, beginning
at 9:30 a.m. Those requesting to appear at the multi-jurisdictional
hearing should have comments that are applicable to two or more DST
investigations.
For either hearing, you must submit a request to appear at the
specific hearing using the electronic portal at https://comments.ustr.gov/s/. You will be able to view a docket entitled
`Request to Appear at Hearing on Proposed Action in Section 301
Investigation of India's Digital Services Tax.' Requests to appear must
include a summary of testimony, and may be accompanied by a pre-hearing
submission. Remarks at the hearing are limited to five minutes to allow
for possible questions from the Section 301 Committee. All submissions
must be in English. To be assured of consideration, USTR must receive
your request to appear by April 21, 2021.
V. Procedures for Written Submissions
You must submit written comments, rebuttal comments, and requests
to appear at the hearing using the electronic portal at https://comments.ustr.gov/s. You will be able to view a docket entitled
`Comments Concerning Proposed Action in Section 301 Investigation of
India's Digital Services Tax' on the portal, docket number USTR-2021-
0003.
You do not need to establish an account to submit comments. Fields
with a gray (BCI) notation are for Business Confidential Information
and the information entered will not be publicly available. Required
fields are marked `Required' and will have a red asterisk (*). Fields
with a green (Public) notation will be viewable by the public.
The first screen of the portal requires you to enter identification
and contact information. Third party organizations such as law firms,
trade associations, or customs brokers should identify the full legal
name of the organization they represent, and identify the primary point
of contact for the submission. The remaining fields of the form are
optional.
After entering the identification and contact information, you can
complete the remainder of the questionnaire, or any portion of it by
clicking `Next.' You can comment on multiple products in a single
entry, or submit multiple comments. You will be able to navigate
through each screen of the form by clicking `Next,' with or without
entering a response to each field on an individual screen or page.
Additionally, you will be able to upload documents at the end of the
form and designate whether USTR should treat the documents as business
confidential or public information.
For uploads containing BCI, the file name of the business
confidential version should begin with the characters `BCI'. Any page
containing BCI must be clearly marked `BUSINESS CONFIDENTIAL' on the
top of that page and the submission should clearly indicate, via
brackets, highlighting, or other means, the specific information that
is BCI. If you request business confidential treatment, you must
certify in writing that disclosure of the information would endanger
trade secrets or profitability, and that the information would not
customarily be released to the public. Parties uploading attachments
containing BCI also must submit a public version of their comments. The
file name of the public version, which must be uploaded on https://comments.ustr.gov/s/, should begin with the character `P'. The `BCI'
and `P' should be followed by the name of the person or entity
submitting the comments or rebuttal comments. If these procedures are
not sufficient to protect BCI or otherwise protect business interests,
please contact the USTR Section Hotline 301 line at (202) 395-5725 to
discuss whether alternative arrangements are possible. USTR will post
attachments uploaded to the docket for public inspection, except for
attachments marked as business confidential.
You can view all public submissions on the USTR portal at https://comments.ustr.gov/s.
Greta Peisch,
General Counsel, Office of the United States Trade Representative.
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