From July 1St Onwards: 3 Of Textile And Clothing Items For Tax Reduction Of Imported Consumer Goods.

In May 30th, the Executive Council of the State Council decided to decide on a larger scale to reduce import tariffs on consumer goods and better meet the diversified consumption needs of the masses.

The conference decided that from July 1st this year, the average tariff rate of import duty on clothing, shoes, hats, kitchens and sports and fitness products decreased from 15.9% to 7.1%.

Then in May 31st, the Customs Tariff Commission of the State Council issued the notice on reducing import tariff of imported consumer goods.

According to the announcement, reducing the MFN rate of some imported consumer goods involves 1449 taxable items.

Since the most favoured nation tax rate adjustment, since July 1, 2018, the 210 most favored nation tariff rates for import commodities have been abolished, and the rest of the MFN provisional tariff rate continues to be implemented.

What changes will the tax reduction bring to the market structure?

Greatly reducing import clothing tariffs,

What challenges will it bring to China's garment industry?

How to interpret the tax reduction list?

Of the 1449 tax reduction items, about 430 are related to textiles and clothing, accounting for about 30% of the total number of tax reduction items.

Xu Yingxin, vice-chairman of the China Textile Industry Federation, told reporters in the China textile daily that the range of clothing products and the scope of tax reduction in the list are relatively large.

Among them, the tariffs on most of the clothing products dropped from 16% and 14% to 6%, and the rate of tax reduction was more than half. Only a few categories remained at 8%, 10% and 12%.

After tax reduction, the overall import tariff level of clothing is close to that of the European Union. The most favored nation tariff rate is far lower than that of the United States. It embodies the nineteen main goals of "promoting a new pattern of comprehensive opening up" and the positive attitude of sharing market with the whole world and opening wider to the outside world.

It is understood that the China Textile Federation has submitted relevant recommendations to the Ministry of finance. From the results of tax reduction, it is recommended that some products be adopted.

According to Xu Yingxin analysis, from the perspective of China's import clothing pattern, Italy and Vietnam are the two most important source countries of imported clothing in China.

According to customs statistics, China imported 3 million 810 thousand garments from Italy in 2017, with a total value of about 810 million dollars, and the average import clothing price was as high as 200 US dollars.

And the clothing products imported from Vietnam are mainly fast fashion brands which are popular in the market. Among them, knitted apparel is outstanding, and it is also a representative of China's basic demand products for the public.

Reporters noted that customs statistics showed that the amount of clothing imported from China between the two countries last year maintained a high growth rate of 12.9% and 22.2% respectively.

On the one hand, Italy advanced clothing has a strong brand effect and appeal in the consumer's mind, its fashion design, quality and technology have been recognized by the Chinese consumer market; on the other hand, it shows that our residents have strong demand for the fast fashion consumer goods of basic demand.

Which benefits are worth looking forward to?

Reporters noted that in this list, Mao made,

Imported products such as men's knitted or crocheted coats, suits, casual wear suits, and knitted or crocheted women's suit suits made of synthetic fibres have been reduced to 10% from 25%.

For consumers, the most important concern is imported clothing.

How much can the price drop?

Some analysts pointed out that the sales price of imported clothing products, including import prices, import taxes, commercial circulation and other parts of the cost structure, it is difficult to simply use a reduction or digital ratio to summarize.

How much specific consumers will benefit from it and need data to speak.

But it can be determined that after tax reduction will bring more complete market competition and attract more foreign brands and design products to enter the Chinese market. The abundance of market products will increase and consumers will have more room to choose.

How big challenges are facing the industry?

Xu Yingxin believes that after the tax reduction, Italy, which is not representative of China's free trade agreement, will benefit the most.

For example, Italy clothing, which is famous for its design, quality and brand advantages, will have larger market space in China.

In addition, with the pfer of textile processing industry to Southeast Asia in recent years, Vietnam is becoming an international fast.

Brand production and procurement base.

The advantage of fast fashion brands will further consolidate the growth of Vietnam's garment market share.

China's FTA with ASEAN has been implemented since 2010. Since the introduction of zero tariff from ASEAN, Vietnam has also become the main source of clothing imports in China.

Last year, China imported nearly 1 billion US dollars from Vietnam, accounting for 14.5% of China's imports of clothing, and is expected to continue to grow at a high level in the future.

Will China's garment enterprises face greater challenges?

Xu Yingxin believes that from the perspective of industry, enterprises should face this matter with a positive attitude.

At present, the efficient operation level of China's textile and garment supply chain has strong market competitiveness in the world.

The further opening of the market will objectively promote the pformation and upgrading of the industry, and promote the upgrading of quality, variety and brand.

Some people have pointed out that if the import clothing is greatly increased after the reduction of import tax, it will stimulate the enthusiasm of local brands to participate in competition and learning.

Local brands can compete with the world's brands without being able to go abroad. They can accumulate more experience in market competition.

Therefore, from this perspective, the tax reduction is of positive significance.