Textile enterprises worse down the export tax rebate

Confirmation from the relevant authority of thefurther down, we can hardly maintain its."
department, involving light industry, textile, metallurgy,    Will eliminate a number of textile enterprises
steel, machinery and other industries will soon export    Reporter learned that many textile enterprises
tax rebate policy adjustment. State Administration ofin Guangzhou for export tax rebate adjustment
Taxation Management Division of the import andpolicy choice at this time wondering: "RMB has
export taxes are recognized, the State Developmentappreciated by almost 3%, textile industry has been
and Reform Commission, Ministry of Finance andvery difficult, why further downwards?"
other departments do is look into the matter, but    Well-known experts in the textile industry, the
not currently receiving any of the State CouncilWorld Fan Min, president of the Victoria Group,
issued a formal document.estimated that "government may be to cut the
    Textile tax rebates "cried bitter"export tax rebate rate by the textile industry to
    "Shut down 2%, 1%, we can not afford." Forpromote industrial upgrading and structural
the recent export tax rebate will be reduced 2% ofadjustment."
the news, Guangzhou, a large textile enterprise    Fan Min, said growth this year, labor costs, raw
leaders said Mr. Chung was very anxious.materials price index rose a stronger yuan, high oil
    According to sources, the export tax rebateprices, the cost of operation and quotas, etc., so that
rate adjustment will involve light industry, textile,exports of textile enterprises profit margins
metallurgy, steel, machinery and other industries, isdrastically reduced. "At present, China's textile
expected to export tax rebate rate will be loweredindustry must enter a restructuring, industrial
by two percentage points. In addition, variousupgrading of the times, the excess capacity to digest
industries have different rate adjustment, werethe situation, out of some businesses." In his view,
mixed. For example, the textile industry, differentthe State hopes to adjust export tax rebate is to
products will have different tariff adjustment, thepromote the healthy development of the industry.
current state is seeking the views of all parties.    According to public information, the evolution
    "On this issue, Development and Reformof China's export tax rebate rate several times: in
Commission, Ministry of Finance and other1999 to get rid of the negative impact of the Asian
government departments do is study." Statefinancial crisis, the state will average export rebate
Administration of Taxation Export Tax Managementfrom 6% to 15%; October 13, 2003, the State
Department spokesman told reporters that theCouncil issued the Current resolution of the export
export tax rebate policy adjustment, the relevanttax rebate mechanism to cut export tax rebate rate
departments will certainly seek trade associationsof 3 percentage points.
view, companies can also reflect the views of the    In response, Chung said, "2003 national
Association.implementation of the new export tax rebate
    However, China Textile Import and Exportmechanism to cut export tax rebate rate of 3
Chamber of Commerce has said Cao Xinyu, vicepercentage points, tax rebates for textile products
president of, has not yet received an officialfrom the original 17% to 13% now."
document of the higher authorities. "According to the    On export tax rebates
export tax rebate policy adjustment last practice    National or regional export tax rebates on
before the departments concerned to hear industryexports of goods have been customs departure,
views on the organization, will convene to seek suchpre-export production and circulation in the joints
advice, but Chamber of Commerce, this practice hasalready paid VAT or consumption tax and other
not started."domestic indirect taxes, returned to the exporters a
    Guangzhou, a large textile business executivestax system. The main profit of some foreign
described the Chung interview yesterday, down 2companies and even the Government's annual rebate
percent export tax rebates for textile industry isfrom the tax. This is also a means of government to
"worse." He told reporters that the textile industry'sencourage exports by making exports to non-tax
gross margin is now about 3% to 4%, but excludingprices in the international market to avoid double
various charges, net income is less than 1%. "If thetaxation on cross-border movement of goods,
government lowered the export tax rebate gothereby enhancing competitiveness.