china tarriffs on lcd monitors sold to china manufacturer

Approximately 90 percent of all LCD modules are manufactured in mainland China. The remaining 10 percent are manufactured primarily between Japan and Taiwan, and some in Korea. China’s clear stronghold in manufacturing, coupled with its large volume of imports to the U.S., mean these tariffs will definitely impact the industry.

The US government said the tariffs where created in response to China’s Unfair Trade Practices. Specifically, the Section 301 investigation by the USTR revealed:

China uses joint venture requirements, foreign investment restrictions, and administrative review and licensing processes to require or pressure technology transfer from U.S. companies.

China directs and unfairly facilitates the systematic investment in, and acquisition of, U.S. companies and assets to generate large-scale technology transfer.

China conducts and supports cyber intrusions into U.S. commercial computer networks to gain unauthorized access to commercially valuable business information.

Unfortunately, while the USTR works to rectify inequities in these unfair practices, many American manufacturers will have to pay higher prices for their components. That works its way up the supply chain and can ultimately lead to higher prices for American consumers.

The USITC (Office of Tariff Affairs and Trade Agreements) is responsible for publishing the Harmonized Tariff Schedule of the United States Annotated (HTSA). The HTSA provides the applicable tariff rates and statistical categories for all merchandise imported into the United States; it is based on the international Harmonized System, the global system of nomenclature that is used to describe most world trade in goods. Although the USITC publishes and maintains the HTSA in its various forms, Customs and Border Protection is the only agency that can provide legally binding advice or rulings on classification of imports.

Many people are asking about using alternate HTC codes with lower burden implications. Unfortunately, these codes are abundant and complicated. There should be exactly one code that properly categorizes your product.

When a display is designed and built for a single application, it may be more appropriate to use a harmonized tariff code for the end-product instead of the display component. An LCD in a cellphone is a good example of this.

A popular way to do this is to reevaluate your current HTC codes and make sure they’re correct. This can be done with in-house council or the use of a consultant specializing in this area of the government. Ultimately, however, you need get a ruling from the government to be certain you are using the correct code.

Finding a tariff code by perusing the USTR HTC tariff code list can be overwhelming and risky. If the code is chosen incorrectly, it can lead to fines and penalties from the USTR.

Some companies are searching for key suppliers outside of the China region and working towards qualifications of those factories. Others are exploring having key components of the purchased assembly outsourced outside of China so it still satisfies the correct definition of Country of Origin. Again, violating these definitions can lead to costly fines and penalties.

TAIPEI (Reuters) - Taiwan’s Foxconn is exploring the sale of its new $8.8 billion display panel factory in China, people familiar with the matter told Reuters, as demand for the product wanes amid an intensifying U.S.-China trade war.FILE PHOTO: A motorcyclist rides past the logo of Foxconn, the trading name of Hon Hai Precision Industry, in Taipei, Taiwan March 30, 2018. REUTERS/Tyrone Siu/File Photo

Foxconn, formally known as Hon Hai Precision Industry, is in talks to appoint banks to find a buyer for its liquid crystal display (LCD) factory that is being built in the southern Chinese city of Guangzhou, said two people with direct knowledge of the matter.

A sale would come at a delicate time for Foxconn, which has extensive investments in China, a large roster of U.S. clients that includes Apple Inc, and is having to navigate a tricky path amid the protracted trade war between Washington and Beijing. It would mark one of its largest divestments from China.

Foxconn’s discussions are at an initial stage and it has not yet come up with a price tag for the so-called Gen-10.5 facility specializing in large-screen LCDs, the sources said, adding a sale was not a surety.

Foxconn, in a written statement to Reuters, said: “As a matter of company policy, Foxconn does not respond to market rumors or speculation.” The sources requested anonymity because the deliberations are confidential.

U.S. President Donald Trump sharply raised the stakes in the bruising trade war with China and jolted global financial markets by vowing on Thursday to impose a 10% tariff on $300 billion of Chinese imports from September 1.

The trade war has disrupted technology global supply chains in a major way, forcing Foxconn to review its own. That and slowing demand for large-screen televisions and monitors had prompted Foxconn’s management to seek a buyer for the LCD plant, one of the sources familiar with the management’s thinking said.

Questions were also being raised within Foxconn on the need for the Guangzhou project. “Existing plants are already not running at full capacity ... why need another one?,” the source said.

The second source said the new factory would not go into production until early October, which makes it less appealing for buyers because of the additional risks as compared to an already operating plant.

The Nikkei daily reported earlier this year that the company would delay most of its planned production in Guangzhou for a minimum of six months, but Foxconn said the project was on schedule.

Dubbed the largest single investment ever in the southern city by Chinese media, Foxconn announced the Guangzhou plant in 2016, hoping to start operations by 2019 to meet an expected rise in demand for large-screen TVs and monitors in Asia in a challenge to top Chinese display maker BOE Technology Group.

The project was mainly run by a joint venture between the Guangzhou government and Japan’s Sakai Display Products, an advanced panel factory owned by Foxconn founder Terry Gou and Japan’s Sharp Corp, Foxconn’s display unit.

The Japanese panel maker said on Thursday it would build a plant in Vietnam to make flat screens and electronic devices to guard against additional U.S. import tariffs on Chinese goods.

The global display industry has been struggling with a supply glut and tumbling earnings due to moribund sales of televisions and smartphones, and the worsening trade dispute that could raise product prices and dampen consumer demand.

Taipei-based Foxconn said in April that it remained committed to building a display plant and tech research facilities in Wisconsin amid growing skepticism about the fate of the $10 billion project. Trump had cited Foxconn’s Wisconsin plans as proof he was reviving American manufacturing.

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Prices for big-screen televisions and some household appliances could go up significantly if the Trump administration"s proposed tariffs on Chinese imports are enacted.

"On a $4,000 TV ... the tariffs might have a several-hundred-dollar price impact," said David French, senior vice president for government relations at the National Retail Federation, an advocacy group.

"We"re still assessing the list," French said. "There is machinery involved in consumer goods. ... There are chemicals listed that we believe are components of cosmetics and toiletries."

The Office of the U.S. Trade Representative proposed late Tuesday an additional 25 percent tariff on an extensive list of Chinese imports, valued at $50 billion for the year and ranging from aircraft parts to vaccines. A public hearing on the list is scheduled for May 15, and filing requests to appear and comment are due April 23.

"Some goods won"t be imported at all with a 25 percent tariff, but prices of domestic goods will go up the full amount of the tariff," said Nicholas Lardy, a senior fellow at the Peterson Institute for International Economics in Washington.

But he and other analysts pointed out that for a U.S. economy roughly $18 trillion in size, 25 percent tariffs on $50 billion of Chinese imports will have a relatively small effect overall on consumer prices.

Chinese manufacturer Haier, which acquired GE Appliances in 2016, "only imports a very small number of niche dishwashers designed for small spaces," spokesperson Kim Freeman said in an email to CNBC. "We make about 95 percent of our dishwashers in the U.S. in Louisville, Kentucky."

The National Retail Federation estimates that access to imported goods through free trade agreements boosts the purchasing power of the average American family by $18,000 a year.

"It"s going to be very difficult for the retailer to manage their supply chain in order to handle these tariffs," French said. "Consumers may be price sensitive enough that they may slow their holiday purchases. These may be "Grinch" tariffs."

In 2023, global foundry manufacturer revenue will show a 2-3% decrease due to the uncertainty of the macroeconomic environment and the US-China technology war.

RJM Music makes MIDI Foot Controllers that some of the world"s most famous bands have used, including Guns N" Roses, Metallica, Brad Paisely, Muse and Fall Out Boy.

The company, with three employees, builds its devices in San Diego County. Its main product utilizes 23 LCD screens, a type that co-owner Sheri Minelli says is only available from China.

"We"re not Apple," said Minelli, who owns the business with her husband Ron. "We don"t get to choose and make something that fits exactly. We have to take what"s in the marketplace."

On Aug. 22, the Minellis got a statement from the Department of Homeland Security billing them $1,642 in tariffs. That was 25 percent of their purchase for the LCD screens, which individually cost between $7 and $25.

In a series of Tweets last week, President Trump ordered U.S. businesses to see alternatives to China. He also announced plans to raise the current 25 percent rate to 30 percent for $250 billion of goods and products on Oct. 1.

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WASHINGTON — President Trump on Tuesday unexpectedly put off new tariffs on many Chinese goods, including cellphones, laptop computers and toys, until after the start of the Christmas shopping season, acknowledging the effect that his protracted trade war with Beijing could have on Americans.

Mr. Trump pushed a 10 percent tariff on some imports to Dec. 15, and excluded others from it entirely, while facing mounting pressure from businesses and consumer groups over the harm they say the trade conflict is doing.

The stock market soared after the announcement, following weeks of volatility driven by fears that the standoff between the world’s two largest economies could hamper global economic growth.

The decision was the latest twist in a dispute during which China and the United States have alternately escalated tensions with tit-for-tat tariffs and softened their positions as they sought a deal.

Mr. Trump continued to insist on Tuesday that the trade war was hurting only China. But he also admitted that there was potential for the new tariffs to inflict economic pain closer to home.

“Just in case they might have an impact on people,” the president told reporters, “what we’ve done is we’ve delayed it so that they won’t be relevant for the Christmas shopping season.”

Mr. Trump, frustrated that negotiations had failed to yield an agreement, said on Aug. 1 that the United States would impose the 10 percent tariff on $300 billion worth of Chinese imports on Sept. 1. That would be in addition to a 25 percent tariff already imposed on $250 billion of Chinese goods.

But on Tuesday, the United States trade representative’s office said that while a substantial amount of Chinese imports would be subject to the Sept. 1 levy as planned, various consumer electronics, shoes and other items would be spared until mid-December.

The office also said it was dropping 25 types of products from the tariff list altogether “based on health, safety, national security and other factors.” The items include car seats, shipping containers, cranes, certain fish, and Bibles and other religious literature, a spokesman said.

Stocks rallied immediately on the news, with the S&P 500 climbing nearly 2 percent in morning trading before ending the day up 1.5 percent. The benchmark index was lifted partly by shares in retailers and computer chip producers that have been especially sensitive to the trade tensions.

More on ChinaA Messy Pivot:As Beijing casts aside many Covid rules after nationwide protests, it is also playing down the threat of the virus. The move comes with its own risks.

Space Program:Human spaceflight achievements show that China is running a steady space marathon rather than competing in a head-to-head space race with the United States.

A Test for the Economy:China’s economy is entering a delicate period when it will face unique challenges, amid the prospect of rising Covid cases and wary consumers.

New Partnerships:A trip by the Chinese leader Xi Jinping to Saudi Arabia showcased Beijing’s growing ties with several Middle Eastern countries that are longstanding U.S. allies and signaled China’s re-emergence after years of pandemic isolation.

Best Buy, which gets many of the products it sells from China, was among the best-performing stocks in the S&P 500, rising more than 6.5 percent. Apple, whose iPhones and computers would have been subject to the tariffs, climbed more than 4 percent. The technology-heavy Nasdaq composite index ended the day up more than 2 percent.

The tariff announcement followed what Mr. Trump described as a “very productive” call involving Liu He, China’s vice premier and its lead trade negotiator; Robert Lighthizer, the United States trade representative; and Steven Mnuchin, the Treasury secretary.

The three agreed to speak again in two weeks, China’s state-run Xinhua News Agency reported. Negotiators had planned to meet again early next month in Washington.

Now, about $112 billion of Chinese goods will be hit with the 10 percent levy on Sept. 1, according to Chad Bown, a senior fellow at the Peterson Institute for International Economics. Another $160 billion in goods will be subject to the tariff as of Dec 15, he estimated.

Mr. Trump has been pressing Beijing since last year for an agreement that would, among other things, strengthen protections for American intellectual property, open Chinese markets to American business and result in China’s buying large quantities of American energy and agricultural goods.

But negotiators have made little progress since May. The stumbling blocks included whether the White House would roll back the tariffs already in place and whether Beijing would enshrine in law the changes it pledged to make.

As his re-election campaign gears up, Mr. Trump is increasingly focused on ending the conflict in order to maintain his support among farmers, who have lost some of their main export opportunities as China ordered state-owned companies to stop buying American soybeans. But he has also expressed an unwillingness to accept a deal with China that falls short of his goals.

[Mr. Trump said his tariffs and tax cuts would set off a wave of investment, but data show they havenot caused a significant returnof factory activity from overseas.]

The president has tried to persuade China to buy large amounts of American farm goods before an agreement is reached, but that hasn’t happened. He continued to berate China on Tuesday for not making such purchases and suggested that the tariffs might force it to do so.

“As usual, China said they were going to be buying ‘big’ from our great American Farmers,” he wrote on Twitter. “So far they have not done what they said. Maybe this will be different!”

Chinese officials and state media outlets have responded to Mr. Trump’s prodding by taking an increasingly strident tone and threatening to punish American firms.

China has also allowed the value of its currency to fluctuate in recent weeks, raising the specter that it would use it as a weapon. That prompted the White House to label China a currency manipulator, the first time the United States had done that since 1994.

The tariff delay could create an opening for Chinese officials to soften their statements. There is also the question of whether the Trump administration will allow American companies to continue supplying certain goods to the Chinese telecommunications giant Huawei despite a ban on such trade because of national security concerns.

A so-called temporary general license that allows American companies to supply Huawei despite the ban is set to expire on Monday, but the Trump administration could renew it.

Trade groups said they welcomed the reprieve on tariffs for the holiday season, but added that the changes would not reduce the uncertainty they faced.

“The hope is that this creates an opportunity for the two sides to get back to the table, resume the broad-based trade talks and look at some confidence-building measures that would boost the prospects of a big deal down the road,” said Myron Brilliant, the executive vice president of the U.S. Chamber of Commerce.

Matt Priest, the president of the Footwear Distributors and Retailers of America, said the delay was also an acknowledgment by the Trump administration that Americans were bearing the cost of the trade war.

“It is no coincidence that the administration is allowing certain shoes to come in without raising taxes in hopes that prices do not rise at retail during the holidays,” Mr. Priest said. “While we are pleased with the decision to delay new tariffs on certain shoes, we are not satisfied.”

Among corporate leaders, Timothy D. Cook, Apple’s chief executive, has been particularly active in lobbying the president and Mr. Lighthizer against the tariffs. Apple, which builds most of its products in China, has been hit by the tariffs on some smaller products like the Mac Mini, computer parts and cables. But the latest round of proposed levies significantly raised the stakes for the company.

So far, Apple has not raised prices because of the initial tariffs. And the company would probably try to absorb a 10 percent levy on iPhones at first, too, Daniel Ives, a technology analyst for Wedbush Securities, said in a research note Tuesday.

But if the tariffs continue into next year, he said, “Apple will have no choice but to pass this incremental $75 to $100 per smartphone to U.S. consumers.”

Mr. Trump’s tariffs have been front and center for corporate executives and investors since the trade war flared anew in May, and the topic had often been cited on earnings calls between company leaders and shareholders.

With the most onerous levies — those set for Sept. 1 — not yet in place, retail executives have mostly played down their impact on profits, at least publicly. The biggest retailers, including Best Buy, Macy’s, Target and Walmart, are scheduled to report earnings for the most recent quarter starting this week.

I read your publication about the current Chinese export-import tarriff system with interest.However,I am short in getting answer for my immediate question.Perhaps you could help me,I hope

we are exporting weekly goods to Shenzhen district, but in last months it happens that a lot of containers have been stopped to Customs since Customs agents request specific declaration on the amount od Insurance Premium. For us it’s extremely difficult to declare this amount for each invoice since we pay a yearly premium.

Moreover in February we increased some prices and Customs rejected our invoices!!! They told us to declare the reason of the increasing!! So, in accordance with customer, we decided to change all the commercial names of the items in order to avoid confusion!

Customs does not accept annual insurance declarations. However the Customs officer should advise the exporter how to make the declaration, so that this technicality can be resolved easily.

The exporter has the right adjust the prices of products. Customs does however check and asks for explanation of the adjustment. This is done to understand the reason for the change and to avoid human error.

I am looking at setting up a repair centre in Guangzhou to repair my hearing aid devices, the idea would be to have all Asia Pacific countries to ship to Guangzhou for repair and then the repair centre to ship back to those countries. Currently I am going through many websites to understand all requirements, duties & VAT so I can complete a cost comparison to our current process, I am looking for as much information as possible and hoping that you can help me out.

this business and I’m confused as the information regarding taxes and pricing keep changing from person to person that i’ve come across. Can anyone give me information how I should proceed?

As mentioned in the article, export duties are only imposed on a small number of certain goods. In order to confirm the duties on export for polyester, we can check with the Customs Bureau. We will follow-up with you about this in a separate email.

I plan to import POLISHED PORCELAIN FLOOR TILES from Fushan, China, to Pakistan. Will be grateful to know any export tax / FTA or some other tax and the rate of tax applicable to this item. Thanks.

We are having our supplier in India, ship an individual component to our supplier in China, who assembles the entire product using this Indian component, packages and ships the finished assembly to our company in the U.S.

How do we avoid having our Chinese supplier pay a lot of duties and taxes on the component from India, when they are turning right around and exporting the component as part of the total assembly?

I am an Australian boat builder who is looking to get our boats built in China and then shipped back to Australia to sell. My question is what amount of Import tax and duty do I have to pay if I buy and ship the aluminium material from Singapore to the boat building yard in China ? Do I get any refund when the boat produced from this material is shipped from China back to Australia ? Looking foward to your thoughts, Adam.

Thanks for your question. The duty payable in China on imported aluminium into China could be zero if the boat building yard is located in a export processing or bonded zone. In this way they can be shipped to China, worked on but as the product is not intended for the Chinese domestic market they do not ‘officially” enter China. So you need to find a boatyard located in such a site. Otherwise duty will be payable, and as the product is not meant for the China market this just adds an unnecessary – and avoidable – element to the end cost. Let me know if you need assistance with site location, we have clients in the boat building industry in China. – Chris

We are a boat building company based in Indonesia. We plan to export a newly built 32 meter luxury yacht into Hainan, China. We will cruiser her straight from Jakarta into Hainan. What sort of taxes will my customer come across with the importation of this yacht? Just keeping a heads up for my client.

@Astrid – There is a search function on the official website of China Customs and Import duties of various goods abd their respective HS codes that can be found here:

@Haluk: There are four different kinds of aluminum ingots listed under the China Custom’s Online Service Center. The site is in Chinese but does have a search function. It’s here: http://service.customs.gov.cn/default.aspx?tabid=9409

Anyway, exporting aluminum ingots from China is subject to both export duty and value-added tax. The tax rate of VAT is always 17%, while the export duty rate is 15% for such resources.

i was trying to use link (http://www.customs.gov.cn/publish/portal0/tab9409/) for seaching HS codes by myself but i was not succesful. That page did not let me trough its verification code. So i decided to ask here and i would be grateful for any reply to my email.

My company is starting business with importing goods to Europe from China. I have a regular discussion about export duties with my china suppliers. I would like to have some sort of credible source which would give me straight and clear information about real export duties which my china supplier is facing. Is there some credible government source like this in english language?

We are importing to EU mainly HS8443999090 and HS4811900000, HS3703900000. Can i ask about real export duties with these goods? Im especially interested if i had to pay 17% China VAT when im exporting these goods from China to Europe.

I have some issues with my commercialization strategy, your article was really useful but I wonder if there is any chance to email you with some doubts. I am planning on exporting menswear to china,

I think the problem you are facing on that website is that you are putting the “HS” in front of the code, which doesn’t work. You just have to put the numerical code in directly. However, yes it is only in Chinese and can be a bit confusing.

Our China site has been importing goods from different countries. We had encountered an issue where in the China Customs is taxing us base on a higher value. We bought the goods from Singapore for like .05/unit. China customs is taxing us base on 0.162/unit. They do not accept that the real price for the item is just 0.05/unit.

I am administrating an international school in mainland china, and I want to order some textbooks from America. The American textbook publisher requires me to provide my customs registration number before I can complete the order, but I’m finding it very difficult to find out how to get such a number.

@Herbie: You need to provide proof to China customs that the goods were purchased at the amount you said. However they do keep a database of prices on gloablly traded products to ensure the correct amount is being declared, and they can and do impose what they feel is the correct dutiable value on the goods if they wish. You need to negotiate with them and provide hard evidence of proof of the true cost. – Chris

@Nathan: Bringing in school textbooks from overseas can be very difficult as the Chinese government monitor very carefully the publications that can be brought in. It’s not just a matter of customs, it’s also a matter for several other Government departments as well, including the Ministry of Education and the Ministry of Propaganda. You will need professional assitance with this. I have sent you a personal email to discuss. – Chris

@Kian – this China Ministry of Customs website lists all the applicable duties on HS codes for goods imported into China: http://www.customs.gov.cn/publish/portal0/tab9409/

If a local Chinese living in PRC purchases Gold or Silver in either bars or coins from the UK but wants them sending to him/her from the UK to PRC, then are these items subject to any tax.?

Could you please help me check what are the HS codes of quartz-based engineered/artificial/man-made stone and natural stone (marble/granite) exported to China? Is it 68101100 or 68101910 or any number else?

@John Scott: According to China’s customs regulations, gold, silver and the products made from them are duty-free and do not need to be declared if they are less than 50g (2 ounce) in weight. If the amount exceeds the limitation, you should declare it, and duty will be payable. On another note, I wouldn’t be sending gold or valuables through the post or even courier to China. It would be far safer to collect in UK and bring it back in personal luggage.

Modifications and so on you’re best talking to the manufacturer directly, and there are so many – you’ll need to conduct your own online research on that as I have no idea what specification or type of vehicle you want.

I intend to import to the Philippines some stuffed toys (animals – dog, cats, etc.) coming off from a plant in China. My supplier intends to impose their local taxes on top of my acquisition cost. We are willing to accept this term. My question is: how would I know if proper taxes were really levied on the goods? I would like to know how it is calculated and their Tariff rates for such. Reason here is I would like to be fair and have a check & balance protocol for this “at-my-cost” field. Thank you!!

Our company is supplying business partners in China with special metal goods of purpose for car industry produced and developed in EU. Just recently custom in a way blocked one of last shipment and making complete due diligance of supplier and importer and finialy asking for paying of waranty fee, extra duty tax.

I propose exporting rooibos tea(indigenous to South Africa) to China.As part of the BRICS’s trading block what are the import and or customs duties from South Africa to China?

@Rob Read: There are over seven kinds of HS codes for tea in China, however, none of them are specifically for the ‘Rooibos tea’ you enquired about. Overall, tariff duties for various kinds of tea are the same in the country. Specifically:

@Bryan Horridge: In China, tariff duties for a boat vary a lot depending on the size, engine and intended purpose of each boat. We need more information on the boats you intend to manufacture so we can provide detailed tax rates. You can email to tax@dezshira.com to get in touch. We’d also need to know the place of manufacture in China.

If you decide to make the boats in China and use the available materials in the country, the purchase of such materials and the sale of the finished boat is subject to value-added tax and consumption tax.

We are planning on making large quantities of copper imports from US to China. Much of the material may be raw, unprocessed scrap metal. What would be the tariffs I am looking at?

There’s no tax due when you buy product from China, just the purchase amount and the shipping costs which your supplier should be able to advise. However you may face import (customs) duties in the US.

There is an international system in place so that customs officials across each country and around the world can understand each other in relation to specific products. It is called the “Harmonized Tariff Schedule” (commonly referred to as the HS Code) and means nearly all products have a specific code number. If you know that number you can refer to the import duty as applicable in any country.

If you look up Christmas Stockings (probably under decorative stockings) that’ll give you the HS Code and you can find the import duty applicable in the United States.

That will tell you how much the total cost of these items is including purchase, shipping and US import taxes, and from there you can work out how much you need to add to that (marketing, transportation, packaging and your profit) to make this a viable business proposition.

My company imports from China. What are the tax rates, and how do we get VAT back? From where do I get the information about logistic, foe example what roots are the shortest how much the prices are, what are my benefits from importing from China etc..

@Miss T: You can only claim back VAT in China if you have a legal presence there. However, your supplier should be deducting part of this from your invoices as they can claim VAT back when they export to you. If they are charging you the full 17% VAT then that is a mark up on your invoice that should be questioned.

We are exporting boats (luxury yachts) from China to HongKong, Europe and USA. We are looking for the exact types of certifications we need as it seems it is different if the boat is shipped by cargo or sailed on her own bottom.

It is hard to find regulation about the certifications (CE, Module B, Module F, CCS…) needed in each case. I know it is not the exact subject of the article but maybe you can help.

@Em: When exporting boats from China to other countries, the enterprises need to apply with the Chinese customs and submit all the required materials, including the application form, information of the ship and names of the crew. If such application has been approved, the customs will issue a certificate that allows the boat to exit the Chinese port. In terms of the type of the certification, it depends on the imported country of the boat. For example, CE certification is required for all recreational boats entering or sold in the European Union, while CCS certification may be required for importing boats to China.

This is quite a complicated procedural process. If you need assistance please contact one of our China offices for professional assistance with customs: china@dezshira.com

@James – There are six kinds of HS codes for watches in China, and tariff duties vary a lot depending on the materials and brands of the watches. Specifically:

As China and Hong Kong have signed a series of CEPA deals, watches recognized by Chinese government as “Hong Kong’s Own Brand” can enjoy zero import tariff treatment when exporting to China. A full list of Hong Kong’s own watch brands can be found here:

For your information, Chinese brands such as Seagull http://www.seagullwatches.com and the French-Chinese brand The Chinese Timekeeper http://www.thechinesetimekeeper.com are gaining more in desirability because they are making some very fine watches and are Chinese in origin.

i am looking some information.i am from Bangladesh.If i import Ready made Garments (RMG) from Bangladesh what is the tax rate or tariff duties?can someone let me know?

@Solaiman Siddique: There is some variation about the exact HS code for these products as RMGs made by different materials vary a little within their normal rate. Generally, the minimum tariff rate is 16%, and normal rate ranges from 9% to 13%. They are also subject to 17% VAT.

@Nuno: I will send you a back issue of China Briefing magazine on the subject, also please use our ‘search’ function on this website at the top of the page, Just type in “VAT” and it’ll provide you with all our articles on the subject.

We have been offered a MGO manufacturing plant in Nanjing in an ordinary manufacturing zone, not an export zone that I am told holds an export licence, Need advice we wish to purchase PC items out of China doors windows and produce our own MGO board in china for our own use back in Australia for housing construction, First is the export licence an advantage?

@Alfred – my colleague Richard Cant in the Shanghai office of Dezan Shira & Associates will contact you directly via email concerning this issue. – Chris

What is the China Customs duty rate for the importation by individuals (entering at the airport with said items in possession not intended for sale) for gold and silver coins and bullion that exceed 50 grams. And, how is the dutiable value determined on the coins, by their face value or weight??

@Mr. G: Gold and silver coins and bullion that exceed 50 grams in weight being brought into China are required to go through custom declaration. Chinese customs will determine how many quantities of gold and silver exceed their “reasonable range for self-use” based on relevant criteria. For excess self-use they items may be subject to import duties at 10% on their recent market value.

recently some of my competitors have tried to contact my custom agent in china and tried to get the information of the invoices i submit for custom clearance of my goods

@Jorge – No, your customs agent should NOT be divulging this information to your competitors. But that doesn’t mean that he isn’t. If you think he is leaking this data then I suggest changing your customs agent. It would be difficult to bring a legal case in this instance, although I agree it is wrong it would be a very hard case to prove. – Best regards – Chris

Hello I am looking at exporting plastic decking material to Hong Kong from England. Please advise the necessary taxes I have to allow for. Can you please confirm ASAP. Thank you

@Titus: Hong Kong is a free port and does not impose any customs tariff on imports and exports except for four types of dutiable commodities: liquor, tobacco, hydrocarbon oil, and methyl alcohol. So you have no customs duties to pay when shipping the items described to HK.

We are looking to export Centrifugal fans to China and are keen to know how duties and taxes would be calculated and if there is a different rate if the fans are assembled or shipped as components.

@Yuni – You need to find out the HS code for the product. This is an internationally recognized code that customs officials worldwide use to identify specific products. If you don’t have this you will be unable to export it from China or import it into Indonesia as no-one will be able to identify what it is. So you need to find this out. I suggest you visit http://www.hscode.org to help identify the relevant number.

@Bill – The common rate and minimum rate for import duty of Centrifugal fans are 30 percent and 8 percent respectively, and 50 percent and 0 percent for fans with power less than 125w. Tax rate is usually lower for importing components and then assembling in China. However, the customs of China will assess the value of the components, and if the total price of the components accounted for more than 60 percent of the price for a complete equipment, tax rate for complete equipment will be applied.

@Sam – Well that’s really an India import tax question. But we can answer that we have offices in India. On the hard disks imported into India, Basic Customs Duty is zero. However, a Counter-Vailing duty @ 6% and Central excise and customs education cess are imposed @ 3%, each. Further there is Special duty imposed @ 4%.

I’m working on a cost simulation for selling Lithium Carbonate ( it seems that HS 28369100 covers both technical/industrial grade and battery grade) to countries in the Asia Pacific block and eventually Europe. As far as what I’ve learned from your different answers, exporters would get the VAT back on one side and the Chinese company wouldn’t pay duties if it reimports a purified product within 6 months assuming the company exports a product concentrate to Vietnam (for instance) where it gets purified (No HS# change though).

All that said, what are the regular export duties for Lithium Carbonate ? If exceeding the 6 months to re import, what would be the import duties then?

If the lithium carbonate failed to be re-imported within six months, you can apply for extension with relevant customs and such period can be extended for another three months upon approval. However, if the lithium carbonate failed to be re-imported within nine months after being exported, the regular import duties shall apply.

We are a rope manufacturer in the US. We are exporting some cordage to a manufacturer in Qingdao China that will add them to sport bags they are making for us. They will ship the finished product back to us in the States. Will there be taxes and duties placed on this item in China ? Should I place any special wording on the commercial invoice to eliminate taxes since this will be used for manufacturing and shipped back to us. Thanks

hi , I have export out good frequently to china, and every time I stuck with china custom, due to import licence in china, how should we go about applying for this licence, and as for custom duty is there any bench mark or how percent charge ??

@Mark: You shouldn’t face any export duties on these items – but it’s best to check that the manufacturer won’t add on any unnecessary surcharges. Let us know if you need assistance with this.

@Sharim: You can get an Import-Export license by setting up your own Trading Company in China. Our China Briefing magazine issue “Trading With China” details this and can be downloaded here: http://www.asiabriefing.com/store/book/trading-with-china-398

Again, if you need assistance with the setup procedures let us know. In terms of duties, they vary from product to product but the same rate should always apply for each specific item unless regulatory changes occur to adjust this.

I am curious about the taxes and duties I would have to pay if say I purchased tobacco products, more specifically, 100 Cuban cigars, from Hong Kong to China mainland (Shandong province). I am having a difficult time attempting to figure this out (new to the system).

You have a wonderful resource here with Asia Briefing and I’m a regular reader of the magazine and newsletter. My situation is I live in Shanghai and am interested in having 8 oil paintings shipped to me from a friend in the States. Will there be any trouble with customs, and if so how do I go about taking care of this ahead of time and avoiding any hassle? How would any import duty rate be implemented on something like artwork where prices are largely speculative?

Separate question – these will be for my personal collection, but if I want to sell one or two off in the city down the road what will my tax liabilities be?

@Art Collector: Personal articles will be considered as import and subject to import duty when the value of a single article exceeds 1000 RMB and has been determined by the customs as “not for personal use”. Once the paintings are considered imported goods, the import duty = duty paying value * import duty rate. The import duty rate is temporarily reduced to 6% for oil paintings since 2012, and the duty paying value of the paintings will be determined by either the price on the invoice or the recent market price of similar goods from the same source, whichever is applicable.

Incomes from selling the paintings will be subject to individual income tax (IIT). The IIT rate is usually 20%. 3% IIT rate will be applied if the original value of the painting is unable to be determined. If the sales are conducted by an enterprise, the incomes will be subject to corporate income tax instead, with the tax rate of 25%.

I never import such items into China anymore, even for personal use as sometimes things have just gone missing. I’d certainly never rely on China Post, who have a 50% failure rate of delivery whenever I’ve had things sent in from overseas. I’d encourage you to ship to Hong Kong and then hand carry in.

@Adeleh: The VAT rate for both SD cards and Roots Blowers are 17%, and the rate is the same for the same products in all cities of China. The VAT is included in the price you paid to the suppliers. After the export, you could file export refund at local tax bureau. Currently, the VAT rebate rate for both of these products are also 17%, so all of the VAT paid will be paid back. The process will take months though.

I have to say that roots blower is not manufactured in China. It is going to be imported from France to China and then to be re-export from China. Please confirm if 17% VAT rat and 17% VAT refund rate is still applicable or not??

Could I ask if I export brass parts made in Australia to China for processing and then shipped back to Australia, I understand that there will be duties and VAT etc that is unavoidable on the import transaction into China, however as I am not actually selling anything to China, can I declare a nominal value – for example 5000 parts would in reality cost say $20,000 – can I declare $1 per part – so just $5000. No actual payment is made for the parts – the only transaction is a payment from Australia to China for the reprocessing and return shipping. Thanks in advance.

@Ian: This type of processing service is characterized as “processing with supplied material” (PSM) by the Custom and the Tax bureau. Under PSM, no tariff, VAT, or consumption tax will be imposed as long as the quantity of the parts imported match the export quantity of the processed parts. The relevant information of the parts will be put into a manual issued by the Custom when the parts coming into the country. Also the processing company in China must have the qualification approved by relevant government authorities to conduct PSM.

Hi! We are purchasing plastic packaging from a factory in Shenzen. This packaging will then be shipped to a factory in Taishan. This Taishan factory manufactures the product and will load the product into the packaging. This is all being done and paid for by a US based company. The packaged products will then be exported to the US. Should we be paying VAT taxes on the packaging from the Shenzen factory to them? Or would the Taishan factory who is doing the final packout and shipping bill us for the entire VAT tax total?

Thanks for all the information on this page. I’m trying to find out what regime applies to Chinese export of rolled aluminium. Is there a rebate, and if so does it apply to both the export tax and VAT, or just VAT. I am trying to work out the price of exported aluminium from China, if you have any information on internal pricing within China or links to where I can find that information that would be excellent.

@Faye C: The Taishan factory will pay VAT for purchasing the packaging, and this amount of VAT is included in the price of the packaging paid to the Shenzhen factory. For example, if the original price of the packaging is 100, then the final price that Taishan factory will pay for will be 117 (100 plus 17% VAT). If the buyer of the packaged products produced by the Taishan factory is a company in China, then this amount of VAT can be passed to this buyer (again included in the selling price, which will be 117 plus 17% VAT = 136.89).

Therefore, yes, usually the final consumer will bear the entire VAT generated from all value chain. However, when the Taishan factory export the products to the U.S., it can apply for VAT rebate after the export. The VAT rebate rate depends on the product and varies from 5% to 17%. Usually, the foreign buyer could bargain the price with the exporter to cut the part of VAT that the exporter could get back later from VAT rebate.

@Pierre Shepherd: Only the VAT can be refunded. There is no rebate for export duty. The export rate for rolled aluminum varies from 0% to 15% depends on the application of different HS code. The internal pricing model varies for different company. Generally, the price would include all the costs (material, labor, transportation, etc. ), and export companies usually want to put the cost of VAT in the price as well even if they could get the amount back after the export through VAT rebate. All in all, the final price depends on the bargain and negotiation with the sales person of the export company.

Your website is very helpful and I thought I would trouble you with a question since you all have been so willing. We are importing engines to China from the United States in order to attach them to lawn machinery that will then be immediately exported to the United States. In other words, the engines are only in China long enough to be assembled into a machine and then exported back to their country of origin. Will the engines be taxed by the Chinese government on either end of this transaction? I greatly appreciate it if you could point me in the right direction.

@Mike – It depends upon where the assembly is taking place. Ideally this should be based in a free trade or other bonded zone – the engines are imported into the zone (but not into the mainland as they do not pass through customs). Then they can be re-exported as a finished item with the lawn machinery. VAT can also be claimed back upon export on the Chinese sourced component as well.

If the assembly is taking place after the engines are imported into China then this is inefficient – you are paying import duty on the engines and then have to wait to complete the assembly to claim that – and any VAT – back.

@Ester – well shipping is a competitive business so you are getting competing quotes. However I’d recommend using a broker that is well known and reliable, and suggest doing some homework on who they are and their reputation when choosing which one to use.

@Debra: Importation of educational material in China isn’t just a matter of import duties, its also a matter of having them approved by the Ministry of Education. China also has a monopoly on all imported books, magazines and so on and this is a very difficult area to make any headway. Publishing and selling books to China is not a viable business, take my word on this.

We are looking to export scrap copper millberry from China to Australia can you advise all tax and duty we will encounter in China. Thanks. Barry Eadie.

We are looking to import slate into china for use in producing product which will be exported to North America. What is tax and duty on slate from India to China

@Doug: Depending on the material of the slate (e.g. marble, granite) and the process procedure (e.g. polished, unpolished), the common import rate ranges from 70 percent to 90 percent. If the tax treaty applies between India and China, the minimum import rate could apply, which ranges from 0 percent to 10.5 percent. Import VAT rate is 17%.

We must provide our specialised woven polyester textiles to the clothing maker so need to know what rate of import duty would be payable in China on this type of textile.

@Manolis: To report tax fraud in China, you could call (86) 10 6354 3714, being the report line of China’s State Administration of Taxation (SAT). You could also write a letter to them at the following address:

To make an online tip-off, you need to register on the SAT website by providing your legitimate personal information, then report the details. Here is the link to make an online report: http://hd.chinatax.gov.cn/jzxx/jicha.jsp#

@Gary North: In terms of the woven polyester textiles, the common import rate is 130 percent, but the minimum import rate to China could be 10 percent with relevant tax treaties. VAT rate is 17 percent.

I am going to send 30 kg pashmina(Scalfs) to Beijing from Nepal. So i want to know about duty tax of Beijing for pashmina . Please could you tell me about this ? how much percents tax i have to pay in total invoice value ?

We are planning to export of papers and paper board from China to third countries. Please let us know the rate of Import duty and other taxes in china.

The common import rate for feldspar powder is 50 percent. Minimum import rate of 3 percent could apply if there is a relevant tax treaty between India and China. The VAT rate is 17 percent.

The common import rate for pashmina is 130 percent which could be reduced to 14-16 percent (minimum import rate) if tax treaties exist. The VAT rate is 17 percent.

The export rate for the paper board (HS Code No.48181000) is actually 0 percent. By the way, thank you for providing the HS Code which makes our job easier and more accurate when answering these questions.

I want to export device from europe for mould trial to china, after trials this device will be sent back to Europe, How looks taxes with temporary export

Can you kindly advice what procedures I have to do to apply for tax exemptions? Recently purchased a LCD monitor from China and it arrived faulty. Seller informed to send it back but I have checked and the cost to send it back plus the duties and taxes already outweighs the cost of the item. Is there a term that returned goods can be exempted? I only received the item about a week ago. Any documents I can provide to help? The third party courier did not hand me any invoice from the seller in the first place.

@Raf – You could declare the device as a temporarily imported good to the Chinese Customs and obtain an ATA (Admission Temporaire/Temporary Admission) carnet. In order to be granted ATA, certain amounts of deposit or other types of guarantee will be required by the customs. In addition, to be qualified for temporarily imported goods, the goods should be exported generally within 6 months, any extension will need approval from the customs. The import and export duty and VAT are exempted for temporarily imported goods.

I don’t think there will be any taxes imposed on the LCD monitor as long as the customs are convinced this product is for personal use instead of sales purpose.

We are purchasing fashion jewellery items from suppliers in Qingdao, China. The jewellery will contain components that have been imported to China from Austria and the price of these components includes 17% VAT. When the supplier exports the jewellery can they claim back any of the VAT on the components used? If yes what % can they claim back?

@Joanne: The suppliers could claim VAT refund for the jewelry items. Depending on the material of the jewelry, the VAT refund rate generally ranges from 0 percent to 13 percent.

We are a company based in Boston, MA. We ordered crude oil lab analysis from Shanghai, China. The invoice we received contains VAT tax. Do we have to pay VAT taxe in this case? We are no a Chinese company, and we are not importing/exporting goods. If our activity can be classified as anything it would be more along the lines of services exporting.

@Tina: Generally speaking, Chinese companies providing consulting or authentication services to foreign companies should be VAT exempted unless the subject matter (the products or goods) for which the services are provided for are located or produced in China.

@Hamish: The normal import rate for importing dried fruit into China is 70 percent, but it could be reduced to 25 percent if there are tax treaties applied between Australia and China. The import VAT is 13 percent.

Thank you Chris, can they claim the refund on totoal cost of the item or just the component? How do i find a list of the materials and their % refund rate?

In your case, the supplier can claim the VAT back based on the valid tax certificates (for components) they should have. The refund rates are not available online, they will need to check with the customs for detailed information.

@Jonas: The normal rate for import candy is 50 percent. The minimum rate of 10 percent could apply if you enact the relevant tax treaty between China and Sweden. This article explains: https://www.china-briefing.com/news/2010/12/16/using-double-tax-treaties-to-maximize-china-investment-financial-effectiveness.html

Where can I find the rules and regulations for import of Gold and Silver into China? Can one set up a trading company in China to import Gold and Silver and sell the same to Jewellers and Traders? What are the applicable VAT and other taxes for the same?

You can set up a trading company to sell gold and silver ornaments in China, the VAT rate is 17 percent, plus 5 percent consumption tax and applicable corporate income tax and import duties. For setting up a China Trading Company please see: http://www.asiabriefing.com/store/book/trading-with-china-398

@Sandeep: There is no export duty imposed on agricultural machinery. Exporters in the country are subject to 17 percent VAT rate, but they are able to declare VAT rebate and the rebate rate varies on different types of machine, usually ranging from 11 percent to 14 percent.

@Anil: The major taxes you will be subject to are value-added taxes and customs duties. You’ll need help with planning all this out, together with planning your registered capital and all these issues properly to cater accurately for the start up costs. For more information, please contact china@dezshira.com let us know where you’ll be establishing operations and our relevant regional office will be pleased to assist.

You can refer to our India Briefing at http://www.india-briefing.com and type in “import taxes” in the search function. Alternatively contact our Delhi office directly at delhi@dezshira.com

I need your help Chris. i have been searching Chinese taxes for week. I would like to know import sunflower oil to third country China from Russia and what would be the taxes and custom duties. Is it legal to Import sunflower oil to china? because last time we try to import arabseed from Russia but china don’t allow to buy arabseed from Russia .

@Babuna – It is legal to import sunflower oil from Russia to China. The normal import duty is 160 per cent, but it would be 9 per cent if there are relevant treaties between China and Russia. It is also subject to 13 per cent value-added tax.

perhaps you can help here: we may export artworks temporarily from China. I know that after 6 months it is possible to request an extension for another maximum 6 months, right? After that, what happens if:

1) It is possible to request an extension for another 6 months, and the application should be made 30 days prior to the expiration of the first 6 month period;

2)When they apply to temporarily export artworks, they are required to pay a deposit fee that is equivalent to the amount of export duties for exporting the artwork. The deposit fee will be returned if the artwork is reimported to China within the stipulated period. But if the artwork is not returned to China within the period stipulated, the deposit fee will automatically be converted into export duties and paid to the Customs, regardless of whether the work has been sold, returned late, or not returned at all.

@Julia: The normal import duty rate for HS code 39129000 is 45%. The minimum import duty rate of 6.5% will apply if there are certain tax treaties between the export country and China. The product will also be subject to 17% value added tax.

I want to import cut and polished natural semi precious stone in to china from India or Hong Kong , then what will be the import duty ,VAT and other duties applicable.

In other case i export rough gems stone from china to other countries what duties will be applicable. Would you suggest any agency in guangzhou city ,china who can assist me in documentation at competitive prices.

@ Angati: The normal import rate of polished natural semi precious stone is 14 percent, the minimum import rate of 3 percent applies if tax treaty status applies and relevant provisions are activated. The VAT rate is 17 percent. There is no export rate imposed on rough gemstones.

@ Kamolrat: The normal import rate is 100 percent, the minimum import rate of 10 percent applies if tax treaty exists and relevant provisions are activated. The VAT rate is 17 percent. Import duty and consumption tax are not refundable. VAT is refundable only when you are exporting from China.

Could you please help me to know that in which category cotton linter pulp comes and what will be the custom duty on this when importing from china to India. Also please advise me the whole process for importing any material from China to India.

@Amit: The normal import rate for cotton linter pulp is 8 per cent, the export rate is 10 per cent and the value-added tax rate is 17 per cent (H.S code: 4701000000). The minimum import rate is zero if tax treaties and relevant provisions are activated.

In regards to the whole process for importing, please see our magazine on sourcing from China here: http://www.asiabriefing.com/store/book/sourcing-from-china-413 or contact china@dezshira.com

Our company is based in Singapore and we fabricate steel structure for our client in China. Our client is a Shipyard in China building oil rigs and we supply them some fabricated steel structures for their rigs. Upon completion of the fabricated components, we ship them to China and listing them as the consignee. I would like to check who is liable for the import duty, taxes & VAT in China?

@Hui Ling: The consignee is liable for import duties and VAT in China. They cannot claim refunds on the import duties, however, they could claim up to a 17% export VAT refund when exporting the oil rigs. If you require professional assistance, please contact our firm at china@dezshira.com

Planning on importing a food additive from US to china. The additive will be used in the processing of the food and then the food will be exported back to the US. Does this fall under PSM thus no VAT or duties?

I present Yarmarka Company Russia, we’re producing brand packaged cereals beans (and mixtures with them with no flavoring agents and even salt) and would love to start collaboration with China. I’d be very grateful if you could answer which certificates and documents are necessary for us in Russia to successfully export our products (grocery) to China ? Thank you in advance!

My email in April used the wrong terminology. The food additive I am exporting to China will be PIM, not PSM. I plan on shipping product to bonded warehouse wherein the food processor will receive product. I am advised that the processors have the Processing Trade Agreeement “handbook” on file with customs. Is any VAT or Duty the responsibility of the processor to have them exempt? Do I need a Trading License is it unnecessary? Thank you.

@Rob: These are very specific questions. Our team will get back to you directly and we need to know more details. Bear in mind we may need to charge for time here, this is more than a simple query about tariffs. However we’ll reply via email and you can follow up from there.

Could you please help me check what are the HS codes of dairy product? we want to export sunflower cooking oil and Milk to china. By the way please how much tax costs and tariffs.

I am looking for a reliable HS consultancy service based in Hong Kong able to deliver training to my team of Merchandisers regarding HS codes in to the UK.

@Simon – we don’t source suppliers – we’re tax lawyers. We do have an office in Hong Kong but it doe