IV

106TH CONGRESS

1ST SESSION H. CON. RES. 70

Expressing the sense of the Congress that there should be parity among

the countries that are parties to the North American Free Trade Agreement (NAFTA) with respect to the personal allowance for duty-free

merchandise purchased abroad by returning residents, and for other

purposes.

IN THE HOUSE OF REPRESENTATIVES

MARCH 24, 1999

Mr. BONILLA (for himself, Mr. ORTIZ, Mr. REYES, Mr. SKEEN, Mr.

HINOJOSA, Mr. BILBRAY, Mr. PASTOR, Mr. KOLBE, and Mr.

RODRIGUEZ) submitted the following concurrent resolution; which was referred to the Committee on Ways and Means

CONCURRENT RESOLUTION

Expressing the sense of the Congress that there should be

parity among the countries that are parties to the North

American Free Trade Agreement (NAFTA) with respect

to the personal allowance for duty-free merchandise purchased abroad by returning residents, and for other purposes.

Whereas the duty-free allowance for returning residents is an

important element of trade and tourism;

Whereas the United States provides each United States resident who is returning from Mexico after a stay of any

duration a personal exemption from duty on merchandise

valued at up to $400 once every 30 days (or up to $200
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if the individual has claimed an exemption within 30 days

before his or her arrival in the United States), including

in both instances 1 liter of liquor, wine, or beer, and 200

cigarettes and 100 cigars;

Whereas Mexico has a 2-tiered duty-free allowance for its returning residents, set at the equivalent of $50 for border

zone residents of a 25 kilometer strip along Mexico’s

northern border and the equivalent of $300 for residents

who live in the interior of Mexico;

Whereas interior residents of Mexico are also permitted up to

3 liters of wine, beer, or liquor and up to 20 packs of

cigarettes, or 25 cigars, or 200 grams of tobacco, while

border zone residents of Mexico are only permitted up to

1 liter of beer, wine, or liquor, and 10 packs of cigarettes

or 25 cigars;

Whereas border zone residents of Mexico in 1995 were permitted a second allowance that, in addition to the $50

per trip allowance, permitted a $400 duty-free personal

exemption that may be used once per month for clothing,

footwear, food products, personal and household hygiene

products, and medicines, and in any case, personal exemptions may be pooled with other members of the family;

Whereas Canada provides each returning Canadian resident

absent for more than 7 days a duty-free allowance on

merchandise valued at up to the equivalent of $500; after

an absence of 48 hours, a returning Canadian resident

has a duty-free allowance of the equivalent of $200, and

after an absence of 24 hours the Canadian allowance is

the equivalent of $50; and Canadian residents returning

after an absence of at least 48 hours are also provided

a duty-free allowance for 1.14 liters of distilled spirits or
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wine, or 8.5 liters of beer, and up to 200 cigarettes, 200

tobacco sticks, 50 cigars, and 200 grams of manufactured tobacco;

Whereas in 1995 Mexico announced that duty-free stores will

be established at multiple locations on the Mexican side

of the United States-Mexico border, which will sell their

merchandise to United States residents traveling to Mexico and will benefit from the generous United States

duty-free allowance afforded to its residents;

Whereas with the advent of duty-free stores on the Mexican

side of the border serving United States residents, the inequity between the duty-free allowances of the 2 countries is further exacerbated, placing United States retail

establishments which serve Mexican residents at an unfair competitive disadvantage;

Whereas minimal progress has not been made by Mexico to

educate Mexican border officials and shoppers and

United States retailers about the $400 per person allowance for border zone residents of Mexico and the procedures to follow to take advantage of such allowance;

Whereas Mexico’s development of a magnetic card to be used

by returning border zone residents to claim their dutyfree allowances is not fully operational as had been expected by December 1998;

Whereas the United States entered into the North American

Free Trade Agreement (NAFTA) with Mexico and Canada with the intent of phasing out tariff barriers among

the 3 countries; and

Whereas it violates the spirit of the NAFTA for the countries

to maintain restrictive duty-free allowance policies which

are not reciprocal: Now, therefore, be it
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1 Resolved by the House of Representatives (the Senate

2 concurring), That—

3 (1) the United States Trade Representative and

4 the Secretary of the Treasury, in consultation with

5 the Secretary of Commerce, should—

6 (A) initiate discussions with officials of the

7 Governments of Mexico and Canada to achieve

8 parity in the duty-free allowance structure of

9 the United States, Mexico, and Canada;

10 (B) accelerate negotiations with the Gov11 ernment of Mexico to ensure that the expanded

12 allowance enacted in 1995 for border zone resi13 dents of Mexico will be given effective imple14 mentation; and

15 (2) in the event that parity in the duty-free al16 lowances of the 3 countries is not reached within 1

17 year after the date on which this concurrent resolu18 tion is adopted, the United States Trade Represent19 ative and the Secretary of the Treasury should sub20 mit recommendations to the Congress on whether

21 legislative changes are necessary to bring the United

22 States duty-free allowance to a lower amount to con23 form to the allowance levels established in the other
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1 countries that are parties to the North American

2 Free Trade Agreement.

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