There Is An Increase In Tax Policy Adjustments For Import Of Major Technology Equipment.

The Ministry of finance, the General Administration of customs and the State Administration of Taxation jointly issued the notice on adjusting the Provisional Regulations on the importation of major technology equipment import tax, and adjusted the scope and scope of preferential tax for major technology equipment imports.

According to the notice, automatic winder (except for thin line connection) and air-jet looms are included in the catalogue of major technical equipment and products imported without tax exemption (revised in 2010), and will no longer enjoy preferential policies for exemption from customs duties and import value-added tax.

According to the notice issued by the Ministry of finance, the national development and Reform Commission, the Ministry of industry and information technology, the State Administration of Taxation and the State Energy Bureau on the adjustment of the import tax policy for major technical equipment, issued in 2009, according to the development of related industries in China, on the basis of widely listening to the opinions of the competent authorities, industry associations and enterprises, the Ministry of finance, the General Administration of customs and the State Administration of Taxation issued the notice on the adjustment of the Provisional Regulations on the import of major technology equipment import tax (hereinafter referred to as the notice) in April 13th.

The circular pointed out that the list of major technical equipment and products supported by the state (revised in 2010) and the list of key components and raw materials for importation of major technical equipment and products (revised in 2010) shall be implemented from April 25, 2010 and exempt from customs duties and value-added tax on commercial commodities that meet the prescribed conditions.

The scope of new textile machinery products has not been adjusted. Key components of automatic winder are: electronic clearer, air splicer, mechanical splicer, slot cylinder, key parts of high-speed air-jet loom: electronic dobby device, active cam opening device, electronic jacquard device, brown frame, reed, heald wire and polyester staple fiber complete equipment, high-speed viscose filament continuous spinning machine, efficient modern complete cotton spinning equipment, key components and raw materials imported from mechanical and electrical integrated rapier looms, and the policy of exemption from customs duties and import value-added tax is still implemented.

The catalogue of major technical equipment and products imported from no tax exemption (revised in 2010) has been implemented since April 26, 2010. Import tax is levied on the import equipment and the imported technology and fittings and spare parts according to the contract, which are imported into the catalogue of major technical equipment and products not imported for tax exemption (revised 2010).

The automatic winder (except for the form of fine collaterals) and the air jet loom are included in the import catalogue of major technical equipment and products (revised in 2010), which will not be exempt from duty free (revised in 2010), and will no longer enjoy the policy preferences of exemption from customs duties and VAT of import links.

Expert comment

Industry experts believe that domestic automatic winder and air-jet loom can partly replace imports. Therefore, the duty exemption policy for automatic winder and air-jet loom imports is no longer implemented.

However, some key components such as automatic winder and air-jet loom have not been nationalized, so the import of these key parts and raw materials is still exempted from tariff and import value-added tax policy.