Papua New Guinea acceded to the World Trade Organization in 1996 and has liberalized its trade to conform to WTO standards, removing all non-tariff barriers to trade including quotas, bans, and license requirements. The government put a value-added tax (VAT) into effect in 1998 and intends to reduce all non-protective tariffs to zero using the VAT. Currently, there are import duty rates of 5%, 8%, and 11%. The protective tariff is 40% and there are higher rates applied to luxury items such as tobacco and liquor.