On March 24 2016, China Ministry of Finance, the General Administration of Customs and the State Administration of Taxation jointly issued the “notice on cross-border e-commerce retail import tax policies”.
From April 8 2016, China will implement cross-border electronic commerce retail sales (enterprise to consumers, B2C) import tax policy and adjustment of personal postal articles tax policy.
Cross-border e-commerce retail goods will no longer be charged by personal postal articles tax but imposed tariffs on goods and import value-added tax and consumption tax. For goods that do not belong to cross-border retail personal products or do not have electronic information of the cross-border transactions will be taxed according to the existing provisions.
The good news for cross-border online shoppers is, products on cross-border e-commerce platforms can get instant customs clearance.
Currently reasonable quantity of imported goods for personal use are charged a personal postal articles tax, which is a combined taxation of customs tariff, import VAT, and consumption tax and is still lower than regularly imported goods. And, it can be exempted from tax if the tax payment is no more than 50 yuan.
In accordance with the new cross-border e-commerce retail import tax policy, cross-border e-commerce retail imports of goods in a single transaction has a limit of 2,000 yuan and an annual limit of 20,000 yuan for personal transactions. Within the limited value of imports of cross-border e-commerce retail import goods, tariff rate is temporarily set to 0%; import VAT and consumption tax have temporarily taxable amount of 70% levy. The 50 yuan tax payment exemption will no longer apply.
According to the news released by the Ministry of Finance, in order to optimize the tariff structure, make it convenient for travelers and consumer declaring tax, and improve the efficiency of customs clearance, China will adjust the personal postal articles tax policy (four tax categories of 10%, 20%, 30% and 50%) to three categories of 15%, 30% and 60%.
Category 1 goods (15%) are items of major MFN with zero tariff; category 3 (60%) are for high-end and luxury goods; the rest fall into category 2.
