NAFTA AGRICULTURE FACT SHEET:
Tobacco

TREATMENT OF TARIFFS:

• Upon enactment of the NAFTA on January 1, 1994, the United States began a 10-year phaseout of all existing tariffs on tobacco and tobacco products imported from Mexico.

TREATMENT OF QUANTITATIVE RESTRICTIONS:

• When the NAFTA took effect, Mexico converted its import licensing regime for tobacco and tobacco products imported from the United States (and Canada) to tariff-only treatment.
• U.S. (and Canadian) tobacco and product exports to Mexico were initially assessed a 50-percent tariff, which is being reduced to zero in equal installments over a 10-year transition period. For 1998, the Mexican tariff rate on tobacco and products is 25 percent.

RULES OF ORIGIN:

• For cigarettes and cigars, the de minimis allowance is 9 percent by value. For example, a U.S. cigarette company may claim NAFTA tariff preference on U.S. cigarettes exported to Canada or Mexico when the value of the imported Oriental and filler tobaccos in those cigarettes does not exceed 9 percent of the value of the shipment of the cigarettes.

U.S. Unmanufactured Tobacco Trade with Mexico

Value in $1,000; volume in metric tons.

Last modified: Friday, November 18, 2005