Trump cites India tariff on Harleys, says will fight back

WASHINGTON: President Donald Trump has again cited the tariff imposed by India on Harley-davidson motorcycles as an example of “unfair” trade practices that the US must fight with “reciprocal taxes”, since America does not have a levy on Indian motorcycle imports.

Trump has long contended that the Indian tariff on Harleydavidson is prohibitively high and severely disadvantages the firm against the competition. He first mentioned it in his maiden address to a joint sitting of the US Congress in February 2017, just weeks after taking office, although he didn’t name India at the time. He has been less coy since then. “We pay a tremendous tax to get into their countries — motorcycles, Harley-davidson, it goes into a certain country. I won’t mention the fact that it happens to be India, in this case,” Trump said amid laughter during a discussion on trade with US lawmakers at the White House on Tuesday.

Trump went on to mention a “great gentleman”, whom the president did not name, who had called him and said, “‘We have just reduced the tariff on motorcycles, reduced it down to 50% — 5-0 — from 75, and even 100%.” This was an apparent reference to Trump’s phone conversation with Indian Prime Minister Narendra Modi on February 8, when the two leaders had discussed the political turmoil in the Maldives and the situation in Afghanistan.

On February 12, the Central Board of Excise and Customs issued a notification that slashed customs duties on imported luxury motorcycles of high-end brands, including Harley-davidson and Triumph Motorcycles UK, to 50%. Earlier, import of motorcycles with engine capacity of 800cc or less attracted 60% duty, while those over 800cc attracted 75% duty.

Trump added, coming to the nub of his argument, that while Harley-davidson pays that kind of tax, Indian motorcycle exporters pay nothing: “And yet they (Indian companies) sell thousands and thousands of motorcycles...you know what our tax is? Nothing.”