Anti Dumping Duty Tax Interview Questions & Answers

Anti Dumping Duty Tax Interview Questions

Are you preparing for an Anti-dumping duty tax job? Wisdomjobs is the right place to make your job search simple. An anti-dumping duty is a protectionist tax that a government imposes on overseas imports that it thinks as priced below the market value. Anti-dumping duties are forced by the Department of Commerce and frequently exceed 100%. This is an unfair practice which can have a negative effect on global trade. In order to set right this situation Central Govt. imposes an anti-dumping duty not to cross the margin of dumping related to such goods. Anti-dumping duty tax jobs are in great demand in popular cities like Delhi, Mumbai, Pune, Chennai, Hyderabad etc. Go through our Anti-dumping duty tax job interview questions and answers page designed by professionals that can help you to get ready to answer job-related interview questions.

Anti Dumping Duty Tax Interview Questions And Answers

Anti Dumping Duty Tax Interview Questions
    1. Question 1. What Is The Non-injurious Price And Injury Margin? How These Are Worked Out?

      Answer :

      Non-Injurious Price (NIP) is that level of price, which the industry is, expected to have charged under normal circumstances in the Indian market during the Period defined. This price would have enabled reasonable recovery of cost of production and profit after nullifying adverse impact of those factors of production which could have adversely effected the company and for which dumped imports can't be held responsible.

    2. Question 2. How Does Protectionism Affect Gross Domestic Production (gdp)?

      Answer :

      The vast majority of economic literature suggests that protectionist policies reduce the gross domestic product, or GDP, of domestic and foreign nations. And, as a logical corollary, strong evidence suggests trade liberalization, or the removal of protectionist barriers by a home country, creates significant productive benefits and expands GDP.

    3. Question 3. How Do Tariffs Protect Domestic Industries?

      Answer :

      Tariffs are essentially taxes or duties placed on an imported good or service by a domestic government, making domestic goods cheaper for domestic consumers and imported goods more expensive for companies exporting goods from their industry into the domestic industry.

    4. Question 4. What Is The Logic Behind Anti Dumping Duty Tax?

      Answer :

      The logic behind anti-dumping duties is to save domestic jobs, although critics argue that this leads to higher prices for domestic consumers and reduces the competitiveness of domestic companies producing similar goods.

    5. Question 5. What Are The Parameters Of Injury To The Domestic Industry?

      Answer :

      Broadly, injury may be analyzed in terms of the volume effect and price effect of the dumped imports. The parameters by which injury to the domestic industry is to be assessed in the anti dumping proceedings are such economic indicators having a bearing upon the state of industry as the magnitude of dumping, and the decline in sales, selling price, profits, market share, production, utilization of capacity etc.

    6. Question 6. What Are The Essential Requisites For Initiating An Anti Dumping Investigation?

      Answer :

      The following are essential for initiating an anti dumping investigation: - 

      Sufficient evidence to the effect that ; 

      • There is dumping 
      • There is injury to the domestic industry; and 
      • There is a causal link between the dumping and the injury, that is to say, that the dumped imports have caused the alleged injury.

      The domestic producers expressly supporting the anti dumping application must account for not less than 25% of the total production of the like.

    7. Question 7. What Is Anti Dumping? What Is Its Purpose In International Trade?

      Answer :

      Dumping is said to occur when the goods are ex ported by a country to another country at a price lower than its normal value. This is an unfair trad e practice which can have a distortive effect on international trade. Anti dumping is a measure to rectify the situation arising out of the dumping of goods and its trade distortive effect. Thus, the purpose of anti dumping duty is to rectify the trade distortive effect of dumping and re-establish fair trade. 
      The use of anti dumping measure.

    8. Question 8. What Is Free Trade Policy?

      Answer :

      Free trade policies, in their truest form, advocate for a complete absence of import restrictions (such as tariffs and quotas) and for no subsidization of export industries. The proponents of free trade argue that restrictions on trade make all consumers, even their own country men, poorer than they otherwise would have been.

    9. Question 9. What Are Various Anti Dumping Rules?

      Answer :

      Individual exporter: Any exporter whose margin of dumping is less than 2% of the export price shall be excluded from the purview of anti-dumping duties even if the existence of dumping, injury as well as the causal link is established. 

      Country: Further, investigation against any country is required to be terminated if the volume of the dumped imports, actual or potential, from a particular country accounts for less than 3% of the total imports of the like product.

    10. Question 10. How Do You Define? Normal Value ? Export Price And ? Dumping Margin?

      Answer :

      Normal Value: Normal value is the comparable price at which the goods under complaint are sold, in the ordinary course of trade, in the domestic market of the exporting country.

      If the normal value can not be determined by means of the domestic sales, the following two alternative methods may be employed to determine the normal value: - 

      Comparable representative export price to an appropriate third country. 

      Constructed normal value, i.e. the cost of production in the count.

    11. Question 11. What Is Anti Dumping Duty Tax In Taxes?

      Answer :

      An anti-dumping duty Tax is a protectionist tariff that a domestic government imposes on foreign imports that it believes are priced below fair market value. In the United States, anti-dumping duties are imposed by the Department of Commerce and often exceed 100%.

    12. Question 12. When Anti Dumping Duty Tax Comes Into Play?

      Answer :

      Anti Dumping Duty Tax come into play when a foreign company is selling an item significantly below the price at which it is being produced.

    13. Question 13. What Is The Legal Framework For Anti Dumping, Anti Subsidy And Safeguard Measures?

      Answer :

      Sections 9, 9 A, 9 B and 9 C of the Customs Tariff Act, 1975 as amended in 1995 and the Customs Tariff (Identification, Assessment and Collection of Anti-dumping Duty on Dumped Articles and for Determination of Injury) Rules, 1995 and Customs Tariff (Identification, Assessment and Collection of Countervailing Duty on Subsidized Articles and for Determination of Injury) Rules, 1995 framed there under form the legal basis for anti-dumping and anti subsidy investigations and for the levy of anti-du.

    14. Question 14. What Is The Relief/remedy To The Domestic Industry Under The Anti Dumping Mechanism. Is It Always In The Form Of Anti-dumping Duty?

      Answer :

      The relief to the domestic industry against dumping of goods from a particular country is in the form of anti dumping duty imposed against that country/ies, which could go upto the dumping margin. Such duties are exporter specific and country specific. 

      However, the remedy against dumping is not always in the form of anti dumping duty. The Authority may terminate or suspend investigation after the preliminary findings if the exporter concerned furnished an undertaking to revise his price.

    15. Question 15. Is Anti Dumping A Measure Of Protection For Domestic Industry?

      Answer :

      Anti dumping, in common parlance, is understood as a measure of protection for domestic industry. However, anti dumping measures do not provide protection per se to the domestic industry. It only serves the purpose of providing remedy to the domestic industry against the injury caused by the unfair trade practice of dumping. 

      In fact, anti dumping is a trade remedial measure to counteract the trade distortion caused by dumping and the consequential injury to the domestic industry.

    16. Question 16. What Is The Difference Between Anti Dumping Duty And Normal Customs Duty? Is The Anti Dumping Duty Over And Above The Normal Customs Duty Chargeable On The Import Of An Item?

      Answer :

      Although anti dumping duty is levied and collected by the Customs Authorities, it is entirely different from the Customs duties not only in concept and substance, but also in purpose and operation. 

      The following are the main differences between the two: - 

      Conceptually, anti dumping and the like measures in their essence are linked to the notion of fair trade. The object of these duties is to guard against the situation arising out of unfair trade practices while customs duties.

    17. Question 17. What Are The Parameters Used To Assess Dumping Of Goods From A Country?

      Answer :

      Dumping means export of goods by one country / territory to the market of another country / territory at a price lower than the normal value. If the export price is lower than the normal value, it constitutes dumping. Thus, there are two fundamental parameters used for determination of dumping, namely, the normal value and the export price. Both these elements have to be compared at the same level of trade, generally at ex-factory level, for assessment of dumping.

    18. Question 18. How Is Comparative Advantage Used As A Justification Against Anti Dumping Taxes?

      Answer :

      The theory of comparative advantage suggests that total economic welfare in all countries is improved when countries focus on those industries where they have lower opportunity costs. The benefits of comparative advantage are reduced when domestic industries are subsidized or when foreign industries are subjected to import tariffs. Economists have been uncommonly uniform in advocating free trade policies for centuries.

    19. Question 19. What Is Dumping?

      Answer :

      Dumping refers to exporting a good at a lower price than the price charged for the good at home.

    20. Question 20. How Is Causal Link Established Between Dumping And Injury To The Domestic Industry?

      Answer :

      In the anti dumping proceedings, it is imperative to prove that the dumping has caused injury to the domestic industry. No anti dumping duty shall be recommended without a finding of this causal relationship. That is to say, Dumping should lead to Injury.

      The causal link is to be established generally in terms of the following effects of dumped imports on domestic industry: - 

      • volume effect 
      • price effect 
      • The volume effect of dumping relates to the market .

    21. Question 21. Does Dumping Mean Cheap Or Low Priced Imports?

      Answer :

      Often, dumping is mistaken and simplified to mean cheap or low priced imports. However, it is a misunderstanding of the term. On the other hand, dumping, in its legal sense, means export of goods by a country to another country at a price lower than its normal value. Thus, dumping implies low priced imports only in the relative sense (relative to the normal value), and not in absolute sense. 

      Import of cheap products through illegal trade channels like smuggling do not fall.

    22. Question 22. What Is Disadvantage Of Anti Dumping Duty Tax?

      Answer :

      Anti-dumping duties are believed to distort the market because the government cannot determine what constitutes a fair market price for any good or service. This is because fair market value is whatever price the market will bear as determined by supply and demand.

    23. Question 23. In Case Anti Dumping Duty Is Warranted After The Investigation, What Is The Extent Of Such Duty To Be Recommended/imposed?

      Answer :

      Under the WTO arrangement, the National Authorities can impose duties upto the margin of dumping i.e. the difference between the normal value and the export price. The Indian law also provides that the anti dumping duty to be recommended/levied shall not exceed the dumping margin.

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