"Encouraging and Restriction" Lead the Duties Adjustment in the Next Year

From January 1, 2009, China will adjust the regulations for import and export duties, so as to further enlarge the import of advanced technology, equipment and key components. The lower provisional import tax rate will be adopted for more than 670 commodities. Meanwhile, the export tariff for relevant products shall be levied by means of provisional tax rate, so as to restrict the export of the products with high energy-consuming and high pollution.
 

As pointed out by relevant principal in the Ministry of Finance, China has basically completed the commitment when entering WTO, as the overall level of customs duties was decreased from 15.3 % since entering WTO to current 9.8 %.
 

As pointed out by the Ministry of Finance, China will further expand the import of advanced technology, equipment and key components. Next year, the lower provisional import tax rate will be adopted for more than 670 commodities.
 

As indicated by the relevant person in charge in the Ministry of Finance, we shall support the development of high and new technology, encourage the enterprise to make independent innovation and push forward upgrading of industrial structure, so as to promote the equipment manufacturing industry in China. The lower provisional import tax rate shall be adopted for the raw materials used in electrics, chemical industry and information technology, which are unavailable in China as well as the equipment and components, which are good for introduction and application of new technology.
 

However, the reporter learned that in fact, China's high-tech products suffered from slowing down, as per the foreign trade analysis report recently issued by the National Development and Reform Commission in November, import and export of China's high-tech products from January to November reached USD 704.63 billion, increasing by 12.1%, among which the import thereof reached USD 318.96 billion, up by 7.5 % and declining by 9% as compared with that at the same period of last year.
 

As indicated by Dong Xian’an, senior macro-analyst in Xi'nan Securities, the state takes measures to back the import of high-tech products. This is of great value for upgrading of domestic technology and industrial adjustment. He points out that the introduction of superior technology from abroad will get twice the result with half the effort. China has enormous demand. So, the high-tech products will also stimulate the demands from home use.
 

Moreover, in order to relieve the pressure on the operation of such industries as textile, steel product and fertilizer, China's import tariff will be properly reduced for production-oriented raw materials, which are urgently demanded by means of lower provisional import tax rate in 2009. Also, since December 1, 2008, the policies for canceling of the export tariff for certain steel products and adjusting of seasonal duties for carbamide shall be continuously implemented. Meanwhile, special export tariff rate for part of fertilizer and raw materials shall be lowered.
 

In order to save the energy & resources, protect the environment and encourage the use of renewable resources, so as to promote the sustainable development of economy, China will continuously implement the provisional export rate for the energy & resource-related products such as coal, crude oil, metallic ore as well as wood pulp, coke, ferroalloy, billet and certain steel products, which produce high energy-consuming and high pollution to the environment.    
 

As indicated by the relevant person in charge in the Ministry of Finance, the customs duties is the key heaver for regulating economy, so that the role thereof shall be further strengthened in keeping the stable growth of foreign trade, optimizing of commodity composition of import and export as well as promoting the change of economic growth mode and reorganization of the industry.
 

As pointed out by Dong Xian’an, China has kept the growth mode of low added value, high pollution and high energy-consuming for foreign trade export in a long time. So, it creates negative impact on the environment and consumes a lot of resources.
 

However, he also points out the exporters with high consuming and high pollution products shall be restricted step by step due to the sternly international economy and negative growth of export, or such enterprises would suffer from crisis of existing.
 

Also, in order to guarantee the fertilizer used for China's agricultural production, the seasonal export tariff will be continuously levied for fertilizers such as carbamide and diammonium phosphate in 2009. Meanwhile, the special export tariff will be continuously levied for compound fertilizer as well as certain fertilizer and raw material thereof.
 

Also, on January 17, the reporter learned from the Ministry of Finance that the free import would be cancelled for the major technical arrangements which could be made in China such as farm machinery, petrochemical products, coal collection and transformer equipment as well as the equipment which has met the demands from China such as harbor machinery, airplane loading equipment, measuring instrument and digital control equipment.
 

The above adjustment is included in the recently List of Import Commodities for the Domestic Investment Items of which the Tax-Free is Unavailable (Adjusted in 2008), jointly issued by the Ministry of Finance, National Development and Reform Commission, General Administration of Customs and State Administration of Taxation.
 

The new list includes 842 items and 276 items are involved for this adjustment, among which 36 items are newly added and the technical standards for 79 items are adjusted. The new list comes into force on December 15, 2008.
 

The non-tax-free commodities specified this time shall be the equipment of which the technical breakthrough has been available in recent years, mainly including engineering machinery, mining machine, textile machinery and chemical engineering machinery, etc.
 

This list shall be the foundation for implementation of tax-free policy for the imported equipment. This adjustment shall guide the enterprises to positively enlarge the import of advanced technology, equipment and key components as well as strongly support the development of key industries such as automobile, light industry, textile, equipment manufacturing industry and electronic information industry.
 

As indicated by the relevant personnel, the adjustment is mainly based on the introduction of advanced technology and equipment, which could not be produced by China as well as boosting the industry upgrading and technological progress and encouraging the enterprises to firstly purchase the home equipment on an equal footing. Also, the home-made equipment shall be encouraged and the interests of both the equipment using sector and equipment producing sector shall be taken into account.
 

The lower provisional import tax rate shall be implemented for the materials used for agricultural production such as animal food and farm chemical intermediate as well as the farm machinery equipment and components such as tea leaves picking machine, potato & beet harvester, forage harvester and large reaper.
 

The provisional import tax rate for bean cake, pork and neem oil shall be restored as the most favored nation tariff.
 

The lower provisional import tax rate shall be implemented for the raw materials used for certain electrics, chemical industry and information technology such as silicon non-oriented electrical steel, ion exchange membrane and LCD polarizing disk as well as the key equipment and components such as gas laser generator and stepless variable compressor of air conditioner.
 

The lower provisional import rate shall be continuously available for energy & resource-related products such as selenium, fuel oil, electrolytic copper and waste tantalum as well as raw materials such as glycerine and naphtha and key parts of wind power generation equipment, which are good for environmental protection.
 

The lower provisional import tax rate shall be implemented for resources & energy-related products such as coal, fuel oil and stone material.
 

The lower provisional import tax rate shall be implemented for advanced industry and agriculture equipment such as air-jet loom, automatic winder, big powered tractor and large-sized reaper, etc.
 

The lower provisional import tax rate shall be implemented for public health-related products such as vaccine, non-obstacle lifter and ceramics as well as partial household supplies.
 

The alternative duties shall be continuously implemented for imported native rubber.
 

The export of products with high energy-consuming and high pollution shall be further restricted. Also, the export tariff shall be continuously levied for coke, crude oil, metallic ore, ferroalloy and billet by means of provisional tax rate.
 

The special export tariff shall be continuously levied for compound fertilizer and the raw materials thereof. Also, the tax rate shall be reduced.
 

The seasonal export tariff shall be continuously levied for fertilizer such as carbamide, ammonium phosphate and double superphosphate. The variable levy shall be continuously adopted during the dull season for use of fertilizer.

Shanghai Securities News