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Think tank moots scrapping customs fees

Customs create four times more costs than revenue Keystone

A study sponsored by the business community says customs barriers are a financial burden for the Swiss economy and take away its competitive edge.

This content was published on March 20, 2006 - 16:46

But the federal customs authorities have rejected the latest Avenir Suisse report as biased.

The study says customs barriers cost the Swiss economy about SFr3.8 billion ($2.9 billion) every year. The fees push prices of exports up by 1.9 per cent, while imports cost 2.3 per cent more.

In total Switzerland's gross domestic product suffers a 0.85 per cent decrease, according to the think tank, which published the results on Monday.

It added that the costs of customs formalities, the delays and other regulations outstripped the revenue by four to one.

The experts argue that small and medium-sized businesses – the backbone of the Swiss economy – were hit hardest by the customs barriers.

The barriers are also one of the main reasons for higher prices in Switzerland, they added.

Customs union

Avenir Suisse said one way of doing away with the disadvantages was to introduce a customs union with the European Union, Switzerland's most important trading partner.

However experts warned such a step required a major overhaul of Switzerland's foreign trade regulations – a move opposed by the Swiss business federation, economiesuisse.

Other options in the report include the mutual recognition of product regulations between Switzerland and the EU.

The study rules out that more bilateral agreements can facilitate trade.

One-sided

The Federal Customs Office has rejected the study as one-sided.

It accused the authors of the report of focusing exclusively on the costs of imports and exports and ignoring the benefits of customs barriers.

The federal authorities say imports from non-EU countries could be cheaper in Switzerland.

They point out the general security aspect of the customs checks in addition to the imposition of value added tax on imports.

Revenue raised at the border totals SF20 billion annually, according to the customs authorities. This is 20 times more than the figure stated in the report by Avenir Suisse.

swissinfo with agencies

In brief

Switzerland is not a member of the EU but it has concluded 16 bilateral agreements with Brussels, covering trade, labour, transport and tax issues.

The EU is Switzerland's main trading partner.

The think tank Avenir Suisse was set up in 1999 by 14 major Swiss companies.

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