SHANGHAI, Oct 9 (SMM) – China’s value-added tax (VAT) rebates on some exports will be raised on November 1 to support foreign trade, according to a message delivered at a State Council executive meeting chaired by Premier Li Keqiang on Monday October 8. SMM believes that this will boost the aluminium industry.
The tax rebate will be raised to 16% for exports that current receive a rebate of 15% or 13%, according to the meeting. The rebate will be raised to 10% for exports that currently receive a 9% rebate, though the rebate will be raised to 13% for some. For exports currently receiving a 5% rebate, the rate will be raised to 6%, with some to 10%.
These will affect the export of aluminium products with VAT rebate rates currently at 13% and 15%, SMM believes.
Products with a current rebate of 13% include aluminium bars, rods, and profiles (HS code 7604), aluminium plates, sheets, and strip, of a thickness exceeding 0.2mm (HS code 7606), aluminium tubes and pipes (HS code 7608), as well as aluminium structures and parts of structures (HS code 7610, 7611, 7612, 7613, 7615, and 7616). For now, exports with a rebate of 15% include aluminium foil (HS code 7607). In addition, stranded wires, cables, ropes and similar articles of aluminium (HS code 7614) already receive a full rebate of 16%, SMM learned.
In 2017, China Customs data showed that the country exported 826,000 mt of aluminium extrusion, 2.08 million mt of aluminium plates, sheets, and strip, 1.16 million mt of aluminium foil, 136,000 mt of aluminium tubes and pipe, as well as 879,000 mt of aluminium structures.
As a trade war with the US escalates, it is hoped that the rebate will encourage domestic companies to export more of such products. Details on the rebate increase are likely to be released in official documents soon.
The higher rebates will "help reduce costs for the real economy, help it cope with the complex international situation and maintain stable foreign trade growth", according to the meeting. It was also pointed out that the move conforms to regulations of the World Trade Organization (WTO).
In the US, aluminium extrusion, foil, and common alloy plates from China are all subject to anti-dumping and countervailing duties after the US Commerce Department determined that such Chinese products are sold below "fair value" in the US.
