What Is The Impact Of The Reduction Of Import Cotton Sliding Standard Tax On Xinjiang Cotton?

On December 21, the Tariff Commission of the State Council issued the adjustment plan for the provisional import tax rate in 2021, in which, the tariff rate of 1% will remain unchanged for cotton imports within the tariff quota.

For a certain amount of cotton imported beyond the quota, a temporary tariff in the form of sliding standard tax shall be implemented. The specific ways are as follows:

1. When the duty paid price of imported cotton is higher than or equal to 14.000 yuan / kg, the ad valorem tax rate shall be calculated as follows: RI = 9.0/pi + 2.69% × PI-1. The calculation result of the above formula shall be rounded to three decimal places. Where RI is the provisional ad valorem tax rate, when the value calculated by the above formula is higher than 40%, RI is 40%; PI is the customs value, unit: yuan / kg.

The sliding standard tax in 2020 is as follows:

1. When the duty paid price of imported cotton is higher than or equal to 15.000 yuan / kg, the ad valorem tax rate shall be calculated as follows: RI = 9.45/pi + 2.6% × PI-1.

It can be seen that, compared with 2020, the starting point and specific tax of sliding standard tax in 2021 will be lowered, and the value of core elements in the formula will also be lowered.

According to the common sense, the reduction of sliding standard tax is beneficial to import, and should be negative for cotton. The actual situation is that Zheng cotton has rebounded greatly after two consecutive days of callback. It can be seen that the impact of tariff adjustment on cotton market is limited. According to the requirements of the document, the purpose of tariff adjustment is to support the construction of a new development pattern and promote high-quality economic development, not to suppress the cotton market. As we all know, the world has experienced a new epidemic in a century, and all walks of life have been impacted to varying degrees. The tax rate reduction this time will reduce the burden of real enterprises to a certain extent. According to rough calculation, one ton of cotton can be cheaper by more than 200 yuan.

According to the calculation formula of cotton import sliding tariff in 2021 and the applicable exchange rate of Customs in January (6.5355), when the price of imported cotton is more than 97.17 cents / pound (including 97.17 cents / pound, the duty paid price is about 14000 yuan / ton), the sliding standard tariff is levied according to the fixed 280 yuan / ton; when the foreign cotton price is between 52.17 cents / pound and 97.17 cents / pound, the sliding standard tariff is applicable; When the price of foreign cotton is lower than 52.17 cents / pound, the fixed tax rate is 40%.