US passed amended export tax laws

The United States House of Representatives has passed legislation amending tax laws on exports which the World Trade Organisation has ruled as being in violation of its rules.

The law now goes to President Clinton to be signed into effect.

The WTO made its ruling after the European Union complained that Washington was in effect subsidising exports by granting big tax exemptions to businesses.

The US has already missed two WTO deadlines for amending its law, but the EU says the amendments now passed still don't go far enough, allowing companies to make savings of up to thirty per cent for their export business.

The BBC Economics Correspondent says the WTO bans most export subsidies because it regards them as a particularly damaging form of government distortion of free trade.

From the newsroom of the BBC World Service