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Food Tax on Shrimp Imports Causes Industry Division

WASHINGTON - While the CITAC/ASDA Shrimp Task Force blasted the U.S. Department of Commerce's preliminary decision to impose a food tax on imported shrimp from Brazil, Ecuador, India, and Thailand, saying it would continue its fight against dumping duties on shrimp imports, the 2,000-member Southern Shrimp Alliance welcomed the move, although the proposed duties of 4 percent to 68 percent are lower than those the alliance had called for, and significantly below those applied to China and Vietnam earlier this month.

The duties are meant to address the belief that the six countries have sold canned and frozen shrimp in the United States at artificially low prices. Those duties are to be distributed directly to affected U.S. shrimpers in accordance with the Byrd Amendment, named for Sen. Robert Byrd, D.W.Va., although the World Trade Organization has called the law illegal.

"Today's action gives 70,000 Americans employed in the industry a better chance to compete fairly in the marketplace," alliance president Eddie Gordon told the San Antonio, Texas Express-News, adding that distributors and restaurant chains have made billions of dollars in the margin between their wholesale purchases of imported shrimp and the retail cost of a shrimp dinner or deli platter.

According to Wally Stevens, chairman of the Shrimp Task Force, however, "This is a case of the current administration imposing a new food tax on millions of Americans that will do nothing to help the shrimp industry, except line the pockets of a few shrimpers. It's a classic case of unnecessary, undeserved, and unwise protectionism."

Stevens added, "Imposing a food tax on America's No. 1 seafood will hurt U.S. consumers, restaurants, grocery stores and other industries, which together employ 20 times the number of U.S. workers than are employed in the domestic shrimp industry."

Shrimp imports make up nearly 90 percent of all shrimp eaten in the United States. The commerce department will make its final determinations on the duties later this year, and by mid-January 2005, the International Trade Commission will reach a final decision on whether imports have hurt the U.S. industry.
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