Import Tariffs On Consumer Goods Have Dropped Again! Appliances And Clothing Will Be Included.



The executive meeting of the State Council, held in May 30th, decided that from July 1st this year, the average tariff rate of import duty on clothing, shoes, hats, kitchens and sports fitness products should be reduced from 15.9% to 7.1%. The average tariff rate of import tariffs on washing machines, refrigerators and other household appliances should be reduced from 20.5% to 8%; the average tariff rate of imported products such as aquaculture, fishing aquatic products and mineral water should be reduced from 15.2% to 6.9%; the average tariff rate of imported products such as washing products and skin care, hair salons and other medical and health products decreased from 8.4% to 2.9%.

In fact, the tariff market for consumer goods has been reduced.

As early as April 26th this year, at the regular press conference of the Ministry of Commerce, the Ministry of Commerce spokesman said that the Ministry of commerce is working with relevant departments to study further measures to expand imports, which will further reduce import tariffs on cars and some consumer goods.

At present, the two major tax reduction measures have been landed.

Since the founding of the people's Republic of China, China's import tariffs have undergone five major changes. The overall tariff rate has decreased from 52.9% in 1951 to 9.8% in 2017, and the average tariff rate on imports of consumer goods has dropped to 7.7%.

Previously, the most recent consumer tariff cut was in December 2017, when the import tariff of 187 consumer products was cut down, and the average tax rate fell from 17.3% to 7.7%.

The scope of the tariff reduction includes a wider range of commodities. Before that, household appliances, clothing, shoes and hats that are not included in the scope of tax reduction will also be included in the scope of tax reduction.

Experts pointed out that reducing import tariffs on consumer goods, on the one hand, will help expand domestic effective supply and better meet people's consumption needs; on the other hand, it will help import products compete with domestic products, guide China's supply system pformation and upgrading, and better adapt to changes in consumer demand.

Imports are cheaper.

The most direct impact of reducing tariffs on imported goods is that the related consumer goods are cheaper.

Take a bottle of Dior perfume as an example, tariff accounts for 33% of the retail price of the terminal. As an important part of the tariff, the import tax rate of some cosmetics is reduced from 8.4% to 2.9%, and the retail price will be significantly reduced.

According to previous historical experience, with the lowering of related taxes and fees of imported consumer goods, relevant commodities will usher in a wave of "price cuts".

For example, in October 2016, the Ministry of Finance and the State Administration of Taxation issued the notice on adjusting the consumption tax on cosmetics import links, reducing the consumption tax rate of high-end cosmetics import from 30% to 15%, cosmetics.

The response was "intense", and the price range of some major brands ranged from 10% to 30%.

With the improvement of living standards, domestic consumers have been enthusiastic about buying imported goods. According to the results of the statistical analysis report on the supply and demand situation of major consumer goods published by the Ministry of Commerce, import commodities have become an important supplement to market supply.

Among the 34 commodity categories with the strongest willingness to import,

Sportswear, outdoor

And so on are included in the scope of this tax reduction.

Consumers' favorite imported cosmetics, maternal and infant supplies, watch glasses and passenger cars were also among the previous tax cuts.

Will it impact domestic related industries?

There are also household appliances in the scope of tax reduction, but consumers do not have a strong desire to purchase imported appliances.

According to the Ministry of commerce data, in the coming year, 85.8% of enterprises plan to maintain import and export status of electrical and electronic products, 10.3% of enterprises will reduce imports, and 3.9% of enterprises will increase imports.

Regarding this, Zhao Ping, director of the Department of international trade research of the China Council for the promotion of trade, pointed out that the import intention of the enterprises may be weakened for the demand of some high quality commodities that have been moderately satisfied in the process of upgrading the consumption structure, or that part of the domestic supply can meet.

Over the past 3 to 5 years, domestic enterprises have made technological advances in the domestic production of some home appliances, which are far ahead of the world. Therefore, the demand for imported household appliances has weakened. This is also the inevitable result of the rise of domestic industry and the enhancement of self development capability.

Consumption reflux positive retail industry

In addition to leading the upgrading of consumption in China, consumers will enjoy more imported goods, which are more abundant, more affordable and more convenient to purchase, and at the same time play a positive role in attracting overseas consumption reflux and promoting import in tax and employment.

In 2016, China has become the world's largest outbound tourist source.

And the largest outbound tourist consumer country.

According to the Ministry of Commerce estimates, at present, Chinese residents spend about 200 billion dollars a year on overseas shopping, and the shopping list includes a large number of high-end goods, consumer goods and so on.

And the difference between domestic and foreign products is the main cause of the consumption outflow.

At present, the price of imported consumer goods is higher than that of overseas, especially watches, bags, clothing, liquor, electronic products and other high-end consumer goods. The price of China's domestic market is much higher than that of overseas.

Experts point out that although tariff is not the only factor that causes the price difference between domestic and foreign products, but by lowering tariffs and other measures, the price of imported goods can be reduced, prompting overseas consumer reflow, and the contribution of imported goods to employment and taxation will remain in China.

Changjiang Securities analysis pointed out that under the background of consumption upgrading, tax policy guided consumption reflux gradually become a trend.

Combined with the 3 new tariff reduction and postal tax, cross border electricity consumption and cosmetics consumption tax new regulations in the early stage of our country, and the further reduction of import tariffs of 187 commodities (mainly consumer goods such as milk powder, seafood and daily necessities) in December 2017, plus the consumer tariff policy or further adjustment, under the background of the expansion of domestic quality consumption, the adjustment of tax policies at the national level, narrowing the difference between domestic and foreign prices, and guiding overseas fees and reflux have gradually become a trend, and the department stores are expected to benefit.

In addition, Changjiang Securities believes that the State guided consumption reflow will be a gradual and progressive process, with a lower probability of a substantial change at a time. The retail price of the luxury goods with tax will be greatly influenced by the brand price discrimination strategy, and the tax rate will be limited. Duty-free products enjoy tariff free, consumption tax and VAT preferences. Tariffs are only one of them. The narrowing of the price gap is limited. Even if the price differentials are narrowed, the advantages of the major airport ports in the duty-free shops are still high, and the trade barriers are higher.

Under the guidance of tax policy, the gap between the inside and outside prices of consumer goods is narrowed, and overseas consumption reflux is expected to be favorable for department stores.

Tianhong shares (002419), Wangfujing (600859) and e Wu business A (000501) will benefit from the adjustment of the enterprise's endogenous business format and the continued improvement of the fundamentals.

In addition, China International Travel Service (601888) is tax exempt for China.

Faucet.

In the short term, offshore duty-free policy relaxed the duty free shops or breakthroughs in Beijing and Shanghai. In the medium to long term, the increase in gross margin under the scale effect will release its performance.