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    Mei Xin Yu: 71 Import Tax Cuts Will Ease Inflation

    2011/7/2 9:16:00 32

    Mei Xinyu Import Tariff

    The latest round of lowering import tariffs has been put into effect since July 1st. Some 33 items of taxes, including refined oil, textiles, dried fruits, metal scrap and UN wrought zinc, have been included in the tax reduction list.


    Generally speaking, the highlight of this round of lowering import tariffs is to meet the reality of international pfer of production.

    Domestic demand

    To reduce domestic inflationary pressure.


    Except for oilseeds, most of the 33 tax items belong to the products with low processing level, which are basically raw materials.

    For an industrialized country, it is common practice to give priority to lower import tariffs on raw materials and lower value-added products, because it can reduce the cost of deep processing and high value-added links at the lower reaches of the country and promote the formation of the division of labor in favor of the domestic and foreign countries.

    In addition to some color changing glasses that may belong to high priced consumer goods, luxury goods that had once been very popular were hardly included in the list. It also showed that this round of tax cuts did not yield much to the pressure of blind and irrational consumption of high-income groups and large city white-collar workers.


    Moreover, among the 33 selected taxes,

    manufactured goods

    On the one hand, the degree of processing is not high; on the other hand, imports will not damage similar industries in China, but it may promote the development of our foreign direct investment.

    For example, the textile that is the majority in the tax reduction list, we are the largest textile country in the world, and our labor costs are rising. Our textile industry is working hard to upgrade. Some value-added and low technology products and links have been pferred overseas, and have made considerable progress.

    In 2010, China's imports of textiles, yarns, fabrics and products were 17 billion 724 million US dollars, an increase of 18.4% over the same period last year. Imports in the first 4 months of this year increased by 17.3% over the same period last year.

    Under such circumstances, the import of some low-end products is not harmful to the sustainable development of our textile industry, and is conducive to the pfer of mature industries in our country to overseas. As a result, the conditions for our overseas investment products to be sold back to the domestic market or to enter the country for further processing are greatly improved.

    And through overseas direct investment and opening up the domestic sales market to them, we can provide our trading partners, especially developing countries and regions with the opportunity to benefit from the economy and promote their common development.

    This is also conducive to improving our appeal in the international community.

    Comrade Chen Yun has a cloud: there is not a handful of rice in the hand, and no chicken is to come. As a big country, we certainly hope to appeal strongly in the international community, but if you have no economic, political and military security benefits, why should other countries follow you?


    The capital and technology threshold of refined oil production is quite high. In theory, if too much refined oil is imported and the import conditions are too favorable, the risk of domestic oil products industry will be damaged.

    But we are a big importer of oil, and our domestic resources can not.

    Meeting needs

    The domestic oil product production capacity also can not fully meet the domestic consumption demand, and because of resource problems, the proportion of various kinds of refined oil products produced by China's refineries may not meet domestic demand, let alone the problems of output and fluctuations in different stages of the cycle.

    Therefore, on the one hand, we export refined oil to overseas, on the one hand, we also increase imported refined oil, and the import of refined oil is more than that of exports.

    Due to the strong domestic demand and no external payment capacity, we have an upward trend in net imports of refined oil products.

    In 2010, China's oil products exported 26 million 880 thousand tons, an increase of 7.5% over the same period last year, 36 million 880 thousand tons of imports, a slight decrease of 0.1% over the same period last year, and a net import of 10 million tons. In the first 4 months of this year, China's refined oil exports 8 million 630 thousand tons, a year-on-year decrease of 9.2%, 14 million 250 thousand tons of imports, an increase of 18.3% over the previous year, and a net import of 5 million 620 thousand tons.

    This arrangement is not harmful to our domestic refining industry, and is not harmful to our world factory status.


    In addition, under the condition of high inflation pressure, reducing the import tax on raw material energy can alleviate the inflation pressure from two aspects: on the one hand, to reduce the energy cost of upstream raw materials; on the one hand, to reduce the trade surplus and the corresponding central bank's foreign exchange occupation, thereby reducing the central bank's basic money supply and indirectly reducing the inflationary pressure.

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    Textile And Garment Industry: Consumption Upgrading And Industry Prosperity

    China's economy has changed from investment driven to domestic consumption, and the textile industry has been improving as a whole. Over the past 10 months, China's textile and garment manufacturing owners accounted for 3 trillion and 445 billion 279 million yuan of business revenue.

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