TOKYO, April 10 Japan is considering slashing tariffs on U.S. beef imports to less than 10 percent from the current 38.5 percent in negotiations aimed at laying the ground for a broad Pacific trade pact, the Nikkei business daily said on Thursday.
The proposed cut would be much deeper than one negotiated with Australia, which on Monday agreed to a trade deal with Tokyo including a halving of the levy on frozen beef to 19.5 percent.
Japan and the United States are seeking a two-way trade deal, regarded as a key part of the U.S.-led Trans-Pacific Partnership (TPP), before Obama travels to Japan for an April 24-25 state visit.
The TPP is the centrepiece of Washington's push to increase its Asian presence.
Japanese and U.S. trade officials returned to the negotiating table on Thursday, following more than 10 hours of intense talks the day before in which they made some progress, but remain apart on some major issues, according to both sides.
As part of its proposal, Japan is also looking to impose restrictions if U.S. beef imports increase considerably as a result of lowering of the levy, the Nikkei said. The final details would be worked out at a later date, the paper added, without citing any sources.
The United States wants Japan to open its rice, beef and pork, dairy and sugar sectors - politically powerful sectors that Japan's Prime Minister Shinzo Abe has vowed to defend.
U.S. Trade Representative Michael Froman said on arrival in Japan that the U.S.-led Trans-Pacific Partnership - which aims to scrap all tariffs - aimed for a higher standard than the Japan-Australia deal, particularly on beef.
Following the talks on Wednesday, Japanese Economy Minister Akira Amari said "debate has deepened considerably in some areas, but there's still considerable distance" between the two sides. Froman said that the negotiators made some progress, "but we still have gaps between us". (Reporting by Antoni Slodkowski; Editing by Richard Pullin)