Raising The Export Tax Rebate Rate Of Textile Industry And Promoting The Upgrading Of Industrial Structure

The Ministry of Finance and the State Administration of taxation have raised the export tax rebate rate of some textiles and clothing to 13%.

We can also see that the adjustment is structural and embodies the policy orientation of maintaining pressure.

Under the premise of short-term easing of monetary tightening policy, fiscal policy will become more and more important.

In China, the adjustment of export tax rebate rate is one of the means for the government to promote the adjustment of industrial policies. In recent years, many adjustments have been made, and the most recent one is the reduction of export tax rebates by 2 percentage points in June 2007.

Since the first half of this year, the growth rate of textile and garment exports has obviously slowed down. Under the influence of RMB appreciation and cost increase, the low end manufacturing industry has been most directly affected, so the call for relaxation has been very high.

The policy of raising the export rebate rate is promulgated under such a background.

But in fact, the scope and rate of tax increase were lower than market expectations. For example, viscose fibers in high energy consumption and high pollution industries had not been upregulated, and chemical fiber fabrics, most people's fabrics, some industrial textiles and animal hair fabrics had not been raised.

Reflect the policy adjustment has the pressure of orientation.

The main problems existing in China's textile industry are weak capability of independent innovation, small proportion of high-end products, overcapacity of low-end products and serious environmental pollution.

The government's policy on textile industry in recent years is to promote the upgrading of the industrial structure of the textile industry.

However, the upsurge itself indicates that the government does not want the industrial upgrading process to result in a large number of business failures due to the deterioration of the environment and too short, resulting in social and economic problems.

Chen Deming, Minister of Commerce, said that although the increase was only 2 percentage points, it gave a signal to the entire business community and the international community that the Chinese government still supports exports of labor-intensive products.

Therefore, the increase of export tax rebate rate is a stalling tactic in the trend of industrial upgrading, temporarily relieving the difficult situation of the export oriented textile and garment industry in the appreciation of RMB and the sharp rise in cost and expenses, so that many textile enterprises should take the breath while upgrading the industry.

At the end of July, the central economic work conference gave the first price control to economic development. We can see that although the tone of the macro adjustment has not changed, the regulatory objectives have undergone structural changes.

In order to embody flexibility, the means of regulation and control will shift from original monetary policy to fiscal policy, and the action of fiscal policy will be bigger and bigger.

The export tax rebate rate adjustment is an important signal.