The European Union’s (EU) complaints of high excise taxes imposed on imported wines and spirits would have to undergo tax law amendments, Department of Foreign Affairs Undersecretary for International Economic Affairs Edsel Custodio said Sunday.

The EU is seeking discussions with the Philippines within the ambit of the World Trade Organization as its wines and spirits exports to the country continue to decline due to the high excise tax.

Custodio said changes in the excise tax imposition will have to undergo a long and rigorous amendment of the current tax laws.

He also said the Philippines is not violating any rules of the WTO as excise taxes imposed on distilled spirits coming from European countries are not within the bounds of the world trade body.

Custodio, however, said the issue had been submitted for consideration in the legislative inter agency committee to review excise taxes.

He said the imposition of excise taxes on imported distilled spirits is not discriminatory as “both local and imported products are being subjected to the internal excise taxes.”

“The discriminatory allegation has to be discussed thoroughly by both parties," he said. "We are currently experiencing a trade friction with the EU and the allegations will all have to be based on the legal contract that we committed to the WTO.”

Last week, the EU said it is hoping for a slash in Philippine import taxes as wines and spirits exports continue to decline. It has requested for a trade consultation with the Philippines at the WTO to resolve the issue.

According to the EU, the Philippines’ excise taxes on distilled spirits are “discriminatory” and “in breach of international trade rules,” referring to Article III: 2 of the General Agreement on Trade and Tariffs (GATT).