Cotton Import Sliding Tax Reduction To Curb Cotton Prices Rose Too Fast In The End

The Ministry of Finance issued a circular recently that the Customs Tariff Commission of the State Council recently decided that from June 5, 2008 to October 5th, a provisional slip tax on a certain quantity of cotton imported from the quota would be applied to reduce the amount of high quality cotton imported from 570 yuan / ton to 357 yuan per ton, equivalent to sliding the cotton tax from 5%-40% to 3%-40% and restoring the current sliding tax from October 6th.

First textile network analyst Chen Xiaoyan said that the import cotton sliding quasi tax adjustment is not only a single policy for cotton city and textile industry, but also a "coping card" in the country's current resource products and food rising.

At the same time, in late May, domestic cotton resources were gradually concentrated, the high-grade cotton resources were slightly inadequate, cotton textile enterprises increased their initiative to purchase cotton, the cotton market gradually changed from buyer's market to Seller's market, spot cotton prices rose slightly, and the domestic cotton spot market showed a similar "tail up" phenomenon with 2006.

At this point, the international cotton price has almost reached the lowest point in 2007/08. Cotton price is hovering around 70 cents / pound. Imported cotton is 50-300 yuan / ton lower than the corresponding grade cotton under the 1% tariff.

Chen Xiaoyan said that lowering the tax level of imported cotton at this time will help promote cotton imports and prevent the cotton price rising at the end of the year, which is in line with the principle of rational use of low price cotton imports.

In addition, due to various factors, the survival environment of the textile industry has deteriorated unprecedentedly, and enterprises have ceased production and production greatly.

Chen Xiaoyan pointed out that the adjustment of import cotton quasi tax can not directly change the plight of the textile industry, but it has a positive effect on reducing the cost of cotton production in textile enterprises, promoting the import of cotton and ensuring the supply of textile cotton.