EU Demands End to U.S. Export Subsidy
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The European Union demanded that the U.S. drop an export support program for U.S. companies within the next 12 months, after a World Trade Organization ruling upheld EU claims that the program constitutes an unfair tax break. “The European Commission calls on the U.S. to abolish the system by Oct. 1, 2000,” said Gunnar Wiegand, foreign policy spokesman for the EU’s executive body. The EU said a WTO ruling Friday accepted European complaints against the so-called Foreign Sales Corporation program, which grants tax relief to U.S. corporations exporting through offshore subsidiaries. Wiegand said the program covers $250 billion in exports and represents an unfair subsidy of $2.5 billion a year. U.S. officials said they had not yet reached a decision on whether to appeal the WTO decision. Speaking on condition of anonymity, they said a decision will be made only after the WTO ruling is officially released Oct. 8.
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