Reinstatement of Common External Tariff on Laundry Soaps of HS 3401

The Common External Tariff schedule is a legal trade policy tool of the Caribbean Community that Guyana subscribes to and has embedded into its Customs Act. Notice of Guyana being in violation of this schedule which requires a 40% CET on soaps of tariff heading 3401 has been before the COTED since 2018. This continued violation by Guyana has caused tremendous harm to the main industry of another CARICOM country. Guyana could face legal action through the Caribbean Court of Justice by this continued violation.

Therefore, as a matter of supporting intra-CARICOM trade and CARICOM industries, as well as avoiding potential legal action for violating its obligation under the Revised Treaty of Chaguaramas, the Government took bold action to correct this measure, through the reinstatement. Guyana would expect no less from other CARICOM countries in supporting Guyanese industries. In fact Guyanese producers of soaps will also benefit.

As circumstances dictate, regional policy provides a mechanism for duties on certain items to be temporarily waived to address emergency public health concerns. The government is fully aware of the COVID-19 situation and its impact on consumers and will keep this option under consideration, even as it monitors the COVID-19 situation and revaluates the COVID-19 Relief Measures currently in place. COVID-19 has affected the entire global economy, including sister CARICOM countries who rely on the regional market for support.

Very important to note is that the reinstatement of the 40% CET on soaps will apply only to soaps coming from non-CARICOM countries. All soaps (bath and laundry) sourced from with the Caribbean Community (CARICOM) will continue to be imported into Guyana duty free. CARICOM Countries such as Dominica and Jamaica produce soap. In fact, Guyana imported on average 38% of its soaps from Dominica (2001 to 2015). This includes soap brands such as Betta Blue and Tru Blue, Real and Reddy. These soaps as well as soaps coming from other CARICOM countries will continue to face a rate of 0%. Consumers can therefore expect no price increases on these soaps.

Guyana values its trade with the Caribbean Community, which is its third largest export market and a key market for exports of rice, fish and fruits and vegetables. The government remains committed to supporting CARICOM trade and ensuring that both Guyanese companies and consumers can continue to benefit from the regional market.