Previously, LEDinside reported Taiwan Lighting Fixture Export Association had been striving to include LED lighting products as tariff exempt items at World Trade Organization (WTO) Environmental Goods Agreement (EGA) negotiations.

The second phase of the fifth round of EGA negotiations is scheduled to take place from May 4-8 in Geneva, Switzerland, said Shih-Chao Cho, Deputy Minister of the Ministry of Economic Affairs recently. The Taiwanese government and LED industry are working together with the aim of introducing LED lighting products into EGA’s tariff free list, LED lighting product exports are expected to benefit once included on the list.

WTO logo. (Photo Courtesy of WTO)

LED lighting products exported to China are subject to tariffs ranging from 5% to 20%, and tariffs vary in other countries, according to compiled tariff statistics. If LEDs can be successfully included as a tariff exempt item in EGA, it could lower tariffs to below 5% or even become tariff free. As gross margin sharply decline in the LED industry, LED products tariff free status has become a very important indicator.

If LED lighting products inclusion in EGA tariff free item list precedes the conclusion of Cross-Strait Agreement on Trade and Goods negotiations, the products will be able to be exported to the Chinese market for lower tariffs or exempted from tariffs.

On the other hand, many Taiwanese LED manufacturers that are exporting or operating in the Southeast Asia market including Malaysia, Thailand, and Vietnam are highly anticipating LED products lowered tariffs or tariff exempt status.

There are 17 member states including China, Taiwan, Hong Kong, and others. Up to 54 environmental products are included in the EGA tariff-free list.