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Economy

Duty reductions aim to increase consumption

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2019-04-10 08:05:07China Daily Editor : Mo Hong'e ECNS App Download

A consumer chooses fruit juice at a store selling imported goods in Qingdao, Shandong province. (Photo by Yu Fangping/for China Daily)

China's decision to lower tax rates on a range of goods carried or mailed by individuals into the country is part of a new push to boost imports and consumption and to ensure the public sees the benefits of tax cuts, a senior official said on Tuesday.

Starting Tuesday, duties on inbound articles including books, computers, food, furniture and medicines was reduced from 15 percent to 13 percent, while the tax rate on textiles and electrical appliances will be trimmed from 25 percent to 20 percent, the Customs Tariff Commission of the State Council said in a statement.

Zou Jiayi, vice-minister of finance, said at a news briefing that the latest round of tax reductions focuses on goods closely related to daily life and is intended to deliver a concrete sense of gain to the people.

The measure is also aimed at benefiting patients given that some drugs that are currently subject to a 3 percent import value-added tax rate - including anti-cancer drugs and medicines for rare diseases - will also see a more favorable tax rate. Details on that rate were not disclosed.

The move follows a measure rolled out in March to cut the value-added tax for the manufacturing sector from 16 percent to 13 percent, and the VAT for the transportation and construction sectors from 10 percent to 9 percent.

For residents, customs has set a duty free allowance of 5,000 yuan ($745) for goods that individuals bring into the country. The goods beyond the allowance are subject to a tax also known as the personal postal tax, collected during customs clearance.

Zou said tax reductions do not cover luxury goods such as jewelry, cigarettes, liquor or golf clubs because they do not belong to the category of products that the country encourages the public to consume.

She added that the tax cut policy will not affect the country's booming cross-border e-commerce sector, in which products have an even more favorable tax rate in general.

China also will continue its efforts to improve the level of convenience during custom clearance, reducing associated fees and customs clearance times in an effort to improve the business environment, she said.

The number of certificates required for cross-border commerce will be reduced, and a mechanism enabling importers to declare their goods in advance also will be implemented, she said.

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