Shanghai offers export departure tax discount
According to the Hong Kong Trade Development Corporation, on August 1, 2012 both the Chinese Ministry of Finance, the General Administration of Customs and the State Administration of Taxation started a pilot project of a Port of Departure Tax Rebate Policy to optimise the capital turnover of China’s export enterprises and to promote the building of a comprehensive test zone for the development of Shanghai into an international shipping centre
The departure tax rebate forms part of the enhancing of Shanghai into an international financial and shipping centre. After its implementations, export goods shipped from their ports of departure to Shanghai’s Yangshan bonded port area for transhipment abroad will be accorded the new tax rebate once their departure from their ports has been verified. This new system is an innovation in China’s export tax rebate policy and also precautionary measures are in place in view of online data exchange and in order to prevent fraud and to ensure that this policy will be effective.
Over 90 % of export goods from the surrounding areas of Wuhan are transhipped via Shanghai and with the launch of this pilot departure tax rebate initially for cargoes originating only from China’s coastal city of Qingdao and inland city of Wuhan. A few days after the goods departure from the port, export enterprises will entitle to receive the new tax rebates up to now tax procedures clearance needed more than a months. Exporters gain liquidity and improved capital turnover. With these measures Shanghai’s Yangshan will become a port area with the status of a quasi offshore trans-shipment port for the first time. Due to the distribution of shipping routes and the impact of the tax rebate policy as many as 3 million TEUs of cargoes are trans-shipped through Busan each year. These shipments will be the potential business volume of the port of Shanghai in the years ahead. In 2011 she share of water-to-water trans-shipment of containers for Shanghai amounted to 41 % and in the first half of 2012 it increased to almost 43 % and the new tax rebate scheme will increase this share further.