Three Tax Rebates For Textile Industry In Jiangsu

The Ministry of Finance and the State Administration of Taxation issued a notice recently, and decided to further increase the export tax rebate rate of some labor-intensive products, electromechanical products and other products with greater impact since December 1, 2008, and have made clear the specific scope of 3770 commodities that raise the tax rebate rate.

This is the third time that China has adjusted its export tax policy since the beginning of this year.

In order to alleviate the impact of the adverse environment on China's exports, from August 1st this year, China's export rebate rate of some textiles and clothing products increased from 11% to 13%.

Since then, in November 1st, China has appropriately raised the export tax rebate rate of some labor-intensive, high-tech and P high added value commodities, involving 3486 commodities, accounting for 25.8% of the total number of goods in the customs tariff.

What is the impact of raising the tax rebate rate on Jiangsu's foreign trade enterprises?

Based on the import and export data of 1~10 months in Jiangsu Province, the Nanjing customs analyzed the export situation of the related products (hereinafter referred to as tax related products) after the export rebate rate was raised in November 1st.

The results show that raising the export tax rebate rate is beneficial to the industry of export tax related products, but has different effects on various industries.

The export growth rate dropped by 0.5%. According to customs statistics, in this year, the total export tax related products of Jiangsu province were $29 billion 880 million, an increase of 17.2% over the same period last year, and the export growth rate dropped 0.5 percentage points over the same period last year.

These products are mainly textiles and clothing and mechanical and electrical products.

In 1~10 months, Jiangsu exported tax related textile and apparel 23 billion 800 million US dollars, an increase of 17.7%, down 1.2 percentage points from the same period last year, accounting for 79.7% of the total tax related commodity exports in the province. Meanwhile, the export tax related mechanical and electrical products 1 billion 980 million US dollars, an increase of 16.8%, a 4.1 percentage point slower than the same period last year, accounting for 6.6%.

More than 60% of these products are exported to the traditional markets like the European Union, the United States and Japan.

In 1~10, Jiangsu exported 6 billion 640 million dollars, 6 billion 600 million dollars and 5 billion 110 million dollars to the above market respectively, which increased by 26.4%, 12.9% and 12.8% respectively. The growth rate of US exports dropped by 12.9 percentage points compared with the same period last year.

The total of the three accounts for 61.4% of the total export value of the tax related commodities in our province.

Generally speaking, the export growth rate of these products is slightly higher than that of the processing trade.

In 1~10 months, Jiangsu exported 22 billion 240 million dollars of tax related goods in general trade mode, an increase of 17.6%. The export growth rate slowed down 0.2 percentage points over the same period last year, accounting for 74.4% of the total export commodities tax related commodities in the same period. In the same period, the export tax related commodities exported by processing trade reached 7 billion 590 million US dollars, an increase of 16.2%, representing a decrease of 0.4 percentage points over the same period last year, accounting for 25.4% of the total value of export commodities related to taxation in the same period.

Textile industry: welcome a rare rest period. In August 1, 2008, after the export rebate rate of some textile and garment increased from 11% to 13% in August 1, 2008, the export rebate rate of textile and garment increased by 1 percentage points to 14% in November 1st.

According to customs statistics, in the 1~10 month of this year, Jiangsu exported 18 billion 770 million dollars of textile and clothing in general trade mode, accounting for 75.9% of the total value of textile and garment exports in the same period.

According to calculation, after the two large-scale adjustment of tax rates, the export tax rebates for textile and clothing under general trade in Jiangsu will increase by about 3 billion 840 million yuan.

Jiangsu red bean group responsible person said that this year, the RMB exchange rate rose, labor and raw materials costs rise, coupled with the impact of the global financial turmoil, textile and clothing exports difficult.

Enterprises are cautiously optimistic that the state has repeatedly raised the export tax rebate rate for textile and garment products.

Because this improves the net profit margin of textile enterprises, helps to reduce the export pressure of textile industry and ease the tension of capital turnover of some enterprises, but at present, the trend of rigid decline in foreign market demand has not changed, and export growth has not been greatly improved.

According to customs statistics, according to customs statistics, in the 1~10 months of this year, our province exported $809 million of mattresses, bedding and similar products in general trade mode. After adjusting the tax rate, the export tax rebate rate increased by 3 percentage points. According to the estimated export tax rebate, the export tax rebate will increase by 166 million yuan. The export toys and parts 573 million dollars. After adjusting the tax rate, the export tax rebate rate increased by 3 percentage points, and the 117 million yuan will be increased according to the estimated export tax rebate.

Customs experts said that since November 1st, the export rebate rates of mattresses, bedding and similar products and toys and parts have increased from 11% to 14%, and the tax rebate rate has basically covered all the tax numbers of two categories of products.

Toy manufacturing enterprises are highly labor-intensive enterprises, and timely export tax rebates will play a positive role in promoting toy exports.

However, at present, the international economic situation is not good and the global demand is weakening. The actual purchasing power of consumers will be limited by the price level of products and the reduction of future income expectations.

Although the increase of export tax rebate rate helps enterprises to establish confidence, most toy manufacturers believe that it is difficult to determine the trend of toy export at present.

Customs advised: seize the opportunity to upgrade. According to Nanjing customs experts, after the export tax rebate rate was raised in November 1st, according to the comprehensive measurement of the adjusted value of export commodities and export tax rebate rates in Jiangsu Province in 1~10 month, the enterprises in the province will increase export tax rebates to more than 5 billion yuan.

At present, the export tax refund deals with the state tax, foreign exchange, customs, bank and other departments. According to the normal process, the enterprise can get the tax rebate for about 1 months after the completion of the export.

But from the current situation, the increase in export tax rebate has led to increased central financial pressure, and the time span of export tax rebate has increased.

Some export enterprises have reported that the export tax rebates should not be accounted for in 9 or October this year.

It is suggested that the relevant departments should pay attention to this problem and ensure that the preferential policies brought about by the policy adjustment are implemented.

In addition, customs experts also said that the adjustment of the export tax rebate rate can clearly see that the state's continued optimization of the structure of export products and the control of the export of "two high and one capital" products have not changed.

It is suggested that benefited industries and enterprises should seize this rare opportunity to accelerate the pace of industrial upgrading, improve the technological content and added value of products, and strive to build export products with brand advantage in the international market.

In view of the adjustment of the export tax rebate policy implemented in November 1st, the main benefiting objects are the labor-intensive industries represented by the textile and garment industry. The main characteristics of these industries are the large number of employees and the large number of small and medium-sized enterprises with private enterprises as the main body.

Judging from the development of foreign trade in recent years, small and medium-sized enterprises represented by private enterprises have shown great vitality. However, such enterprises are less capable of dealing with policy risks and market risks, and suffer the most serious losses under the adverse effects of RMB appreciation, rising production costs and the deterioration of international trade environment.

Customs suggested that relevant departments should actively introduce specific measures to solve the practical difficulties faced by small and medium-sized enterprises in foreign trade, such as alleviating the financing pressure of SMEs, restoring or increasing the amount of local financial subsidies.