Arrangements for the Changeover from Quotas to Tariff
The Governor's despatch contained the following complaint:
"A lesser but important matter for consideration is the
reported intention of the British Government to impose the new tariff on cotton woven textiles arriving in Britain on or after 1 January 1972. This would mean that duty would be payable on most shipments made in the last two months of 1971 in accordance with the restraint arrangements recently affirmed by the extension of the present Heads of Agreement. I consider this to be inequitable and inconsistent with the spirit of the arrangements. If such a policy were to be pursued I should expect some compensatory adjustments to be made to the arrangements for 1971 and this is a specific matter I should like discussed at the proposed talks.
We were of course well aware that a number of CPA consignments shipped towards the end of 1971 but arriving in the UK in 1972 would be subject to both quota and duty. This is inevitable, given that the quota arrangements are
governed by date of shipment, and the imposition of duty by the date of arrival. Customs have advised us that there is no provision in the Customs and Excise Act for relieving consignments from duty on special grounds (eg because the goods have been licensed under quota). Major legislation would probably be necessary to permit such a relief which would of course only operate for the first few weeks of 1972. Any such scheme would be extremely complex, given the variations in shipping times, export licensing procedures, etc. All in all, tnis is simply not a proposition; and, in any event, we should not wish on policy grounds to defer the full implementation of the tariff:
the Crosland statement said that the tariff would be introduced on
1 January 1972; he did not qualify that date in any way; and it would be unacceptable to public opinion generally, and particularly to Lancashire and the Lancashire lobby in the House, if Commonwealth cotton textiles continued to enter the UK duty-free for two months or so after the beginning of next year.
Goods
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it would also be inequitable as between Commonwealth suppliers. exported by the Commonwealth restricted countries with the shortest shipping times to the UK - Gibraltar, Malta, Cyprus would become subject to the duty only a week or so after 1 January 1972. The furthest suppliers - like Hong Kong would continue to enjoy duty-free entry for another six or so weeks thereafter.
The Governor suggests that some compensatory adjustments should be made to the arrangements for 1971. We cannot agree to this because:
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when we saw Mr Cater on 26 November to discuss the extension of the' restraint arrangements to cover the year 1971, we made it clear that all goods arriving in the UK on or after 1 January 1972 would be liable to
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