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China slashes import taxes

2015-May-26       Source: Szdaily.com

China will slash import tariffs on consumer goods including skincare products, Western-style clothes and diapers from June, potentially giving a fillip to global brands and bolstering domestic consumption amid faltering economic growth.

China will slash import tariffs on consumer goods including skincare products, Western-style clothes and diapers from June, potentially giving a fillip to global brands and bolstering domestic consumption amid faltering economic growth.

The Ministry of Finance said in a statement yesterday it would lower import taxes for some products starting from June 1 by an average of over 50 percent as an “important measure to create stable growth and push forward structural reform.”

Import tariffs for Western-style clothing will be reduced to between 7-10 percent from 14-23 percent, and taxes on ankle-high boots and sports shoes cut in half to 12 percent, the ministry said. Tariffs on diapers and skincare products will drop to 2 percent from 7.5 percent and 5 percent, respectively.

The decision follows a statement by the State Council in April that it would look to reduce import tariffs on some consumers goods to stoke domestic spending and support the slowing economy at a time when record numbers of cash-rich Chinese tourists are splurging overseas.

China retail sales rose 10 percent last month, but eased from March as data showed that China’s economy is under persistent pressure from soft demand at home and abroad.

Chinese consumers often grumble about paying higher prices for goods than in other markets, partly due to steep import taxes. Analysts say consumers in China pay around 20 percent more for luxury goods than their counterparts in Europe.

This often forces shoppers to splash savings overseas or through “daigou” shopping agents, which has helped drive global luxury sales even as China’s own market is set to contract this year, according to a May report from consultancy firm Bain & Co.

The ministry said lowering duties should steer a shift in consumers’ shopping habits, helping boost imports and domestic consumption.

 

Editor: Steven

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