The head of the Customs Department of the General Administration of Customs said on the 27th that this will reduce the value-added tax burden of import enterprises by about 225 billion RMB (RMB, the same below) and reduce the consumer tax burden by 1.35 billion RMB, further stimulating market vitality.
On May 1, last year, China has adjusted the VAT rate from 17% to 11% to 16% and 10%. According to the plan, since April 1, 2019, if the import goods are originally subject to the 16% VAT rate, the tax rate will be adjusted to 13%; the original 10% tax rate will be adjusted to 9%.
The person in charge of the Customs Department of the General Administration of Customs said that with the static calculation of the value of imports in 2018, after the implementation of the VAT tax reduction policy on April 1, the import enterprises will reduce the import value-added tax by about 225 billion RMB, effectively reducing Import enterprise tax burden and financial pressure.
Cross-border e-commerce retail import VAT rates will also be lowered simultaneously. According to the current cross-border e-commerce retail import tax policy, consumers purchase goods through cross-border e-commerce retail import channels. The tariff rate is 0% within the individual purchase limit, and the import link value-added tax and consumption tax are 70% of the statutory payable amount. The person in charge said that after the cross-border e-commerce retail import VAT rate is lowered, this year will reduce the tax burden of 1.35 billion RMB for Chinese consumers, which will help further promote consumption.
In 2018, China has introduced a number of measures to increase imports, including reducing import tariffs, shortening customs clearance time, and holding the first China International Import Expo. Driven by favorable policies, China’s imports amounted to 2.14 trillion US dollars in that year, surpassing 2 trillion US dollars for the first time, a record high.
This year’s Chinese government work report clearly stated that it is necessary to optimize the import structure and actively expand imports. Analysts believe that more policy measures that will help boost imports will be introduced.