Ad Valorem Equivalent

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Ad Valorem Equivalent

In international commerce, a tax on an import that is expressed as a percentage of the value of the import. It is applied during a tariff adjustment. See also: Ad valorem tax.
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Users can also find ad valorem equivalents for all non ad valorem duties and perform aggregations of products and countries as well as simulate tariff reduction scenarios.
Some tariffs were converted to ad valorem equivalents using unit import values and other trade data, as compiled by Global Trade Information Services, Inc.
Known as ad valorem equivalents (AVE), they convert specific duties into ad valorem terms because members, including the EU, have a substantial number of their tariff lines expressed as specific duties.
The talks on agriculture were suspended on April 19 when the EU refused to go along at the last moment with the filter formula for determining the import price of the product to be used in converting non-ad valorem duties into ad valorem equivalents. The import value per unit calculated from Integrated Data Base (IDB) of WTO is to be compared directly with the world price estimate calculated from the United Nations Comtrade database.
* Data sources, a glossary and methodology outlining the calculation of ad valorem equivalents and to different aggregation methods for tariff averages round out the publication.
ITC converted nearly all non-ad valorem duties into ad valorem equivalents.
Members of the World Trade Organisation have agreed to settle a formula for calculating how to turn import tariffs which have a specific value into a percentage value of the overall value of the product, known as ad valorem equivalents.
Because of declining commodity prices, however, ad valorem equivalents came down only by a quarter, namely from 5.1% in 1996 to 3.9 % in 2001.
For LDCs' textiles and clothing exporters, tariff protection in terms of ad valorem equivalents has actually increased: barriers in OECD countries rose from 3.0% to 5.5% for textiles and from 7.5% to 8.3% for garments from LDCs.
The calculations are based on ad valorem tariffs and specific tariffs (translated into ad valorem equivalents).
* calculations of bilateral ad valorem equivalents at the tariff-line level; and