The Gulf Cooperation Council states will finally do away with levying import duty for the country of final destination and may adopt a new and simpler tariff system, according to a UAE official.

All the issues of the GCC customs union will be resolved and the new system will be ready by the end of this year, said Saeed Khalifa Saeed Al Merri, deputy director general of the UAE’s federal customs authority, as per a Bloomberg report in Gulf News.

Though the customs union was launched in 2003, it had been plagued by unresolved issues. Only after the customs union comes into effect can the Gulf common market be formed, followed by the introduction of the Gulf single currency.

According to the new customs union, goods coming into the Gulf are to attract a uniform tariff of five per cent and enjoy free movement among the six GCC states. Whereas under the current system, import duty is charged at the port of entry and is sent to the country of final destination.

The four states of UAE, Saudi Arabia, Oman and Kuwait are in support of a rule to allow the country where the goods arrive to keep 95 per cent of the duty paid and share the remaining 5 per cent with the other Gulf states as per a pre-agreed formula, said Al Merri.

About three per cent of GCC customs duties are presently shared under the final destination system, he revealed.