CARBON FOOTPRINTS IN CUSTOMS TARIFF

Hüseyin Cahit SOYSAL
Board Member

The new harmonized system nomenclature, a product of the World Customs Organization and the European Union, has been meticulously adapted into the "Turkish Customs Tariff Schedule Divided into Statistical Positions". This adaptation, published in the Official Gazette on December 30, 2021, number 5045, is a clear demonstration of our commitment to aligning with international standards. With the changes made, 2139 GTIP correlations were made in 55 chapters, further solidifying our alignment with global environmental goals.

The Harmonized System Nomenclature is a dynamic entity, constantly evolving to meet new needs and accommodate newly invented goods. As a testament to this, our national tariff schedule was recently updated on December 30. This continuous evolution is a reminder of the need for us to stay agile and adapt to the changing landscape of international trade and environmental protection.

Giving new subheading numbers for newly invented technology products is natural. However, capturing carbon footprints using the latest terminology is also possible. More precisely, after the "Paris Climate Agreement" and the "Green Deal" of the European Union came into force, with new expansions, the customs tariff was increased to encourage environmentalism, prioritize the fight against environmental pollution, and, in line with the primary headings included in these agreements, carry out goods in line with these agreements as much as possible. It is starting to turn into a grouping structure. Products deemed necessary within the scope of the Paris Climate Agreement are grouped separately, or goods within this scope are classified under separate subheadings. Thus, we will see that customs administrations' focus on environmentally friendly inspections will gain priority from now on.

The "Paris Climate Agreement," signed in 2015, aimed to strengthen global socio/economic resilience against the danger of climate change in the post-2020 period and to gradually abandon the use of fossil fuels, keeping the global temperature increase below two °C as much as possible compared to the pre-industrialization period. At the Glasgow COP-26 Conference, which ended on November 12, 2021, the target was changed so that global warming would not increase by 2 degrees but by more than 1.5 degrees.

The "Green Deal" document published by the EU on 11.12.2019 stated that a greener, more circular, and more digital EU industrial strategy would be followed without losing its global competitiveness. In this context, the "sustainable product initiative" focusing on "resource-intensive" sectors in the EU and the "Circular Economy Action Plan" was prepared to limit the use of resources in the production phase and encourage the reuse of these resources. The "Farm to Table Agricultural Strategy" aimed to establish a food value chain ecosystem, popularize organic agriculture, reverse biodiversity loss, ensure food security, and ensure nutrition and public health. It was stated that biodiversity will also be supported to increase the ecological services of the environment.

The EU aims to reduce transportation-related emissions by 90% in 2050 with its "Sustainable Smart Transport" strategy.

In this context, with the change made in the Harmonized System Nomenclature,

• A new harmonized system nomenclature code has been opened in tariff heading 29.02 for substances containing hydrofluorocarbons (HFCs) above a certain level. For example, new GTIP numbers were determined for perfluoroethane, perfluoropropane, perfluorobutane, perfluoropentane, perfluorohexane, perfluoromethane under the combined nomenclature code 2903.49.30.
• The harmonized system nomenclature code 1515.60 has been opened for microbial oils and their fractions produced as biodiesel fuel and used for technical or industrial purposes, excluding human food.
• For biodiversity monitoring, insects suitable for human consumption were identified separately with the harmonized system nomenclature code 0410.10.
• Tariff position 0309 was opened, "flour, meal, and pellets of fish, crustaceans, mollusks, and other aquatic invertebrate animals suitable for human consumption," "those belonging to fish" 0309.10.00.00.00 and "others" 0309.90.00.00.00 with GTIP numbers and classified under.
• Within the scope of the "Farm to Table Agricultural Strategy," to ensure nutrition and public health, "Agaricus" genus mushrooms in the harmonized system nomenclature 0709.51, as well as "boletus" genus mushrooms 0709.52, "chanterelles" genus mushrooms 0709.53, "shiitake (Lentinus edodes)" genus. 0709.54, "matsutake" breeds 0709.55, and "dolmans" 0909.56 were classified under the harmonized system nomenclature codes.
• For the same purpose, the harmonized system nomenclature code 0403.10, which included "yogurt," was canceled, and the code 0403.20 was created instead, adding "flavored" or "unflavored" or "added fruit, nuts, cocoa, chocolate, spices, coffee or coffee extract." "plants, plant parts, cereals or bakery products" or not were defined under separate GTIPs.
• To protect and monitor forest assets globally, the combined nomenclature codes 4401.41 for "sawdust," 4402.20 for "charcoal from bark or shells of nuts," 4403.42 for "teak tree," and 4407.23 for "teak wood" were created.

The new industrial strategy of the Green Deal aims to reduce the environmental footprint by promoting the circular economy in the electronic sectors and other "resource-intensive sectors." Although this is the case, until yesterday, there were problems in recycling electrical and electronic scrap and waste into the economy, as the number of recycling facilities in Western European countries was limited. It was intended to contribute to recycling these wastes and scraps by sending them to nearby countries such as Türkiye and Ukraine. However, there are difficulties in customs' declaration of scrap and waste sent to exporting and importing countries. There were hesitations about which tariff position the said goods should be exported, under which tariff position they should be classified in the importing country, and which foreign trade policies should be applied to them.

To eliminate such hesitations and increase the contribution of "electrical and electronic scrap and waste" to the circular economy and accelerate their international transfer, 8549 tariff positions were opened; "waste and scrap of primary cells, primary batteries, and electric accumulators; 8549.11 to 8549.19 for "finished primary cells, primary batteries, and electric accumulators," 8549.21 to 8549.29 for "used principally for the recovery of precious metals," 8549.31 to 8549.39 for "other electrical and electronic assemblies and printed circuit boards" and 8549.91 for "others" Harmonized system nomenclature codes were created under numbers from 8549.99 to 8549.99.

It seems that, in addition to collecting taxes for the customs of the future, the functions of protecting the environment and human health, making efforts to reduce the ozone layer hole, and tightening controls on inputs and products that will increase global warming will be much more important.