A Short Guide to Chinese Customs Regulations

March 29, 2024
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Are you actively engaged in trade with China and find yourself grappling with the complexities of various taxes and specialized calculations? If so, you’re not alone. As the Chinese government continues to adjust import-export tariffs in response to global dynamics, understanding these regulations becomes increasingly crucial for businesses.

Here, we offer a concise overview of essential China import and export regulations, covering taxes, calculations, and strategies to streamline your supply chain management.

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Understanding Taxation:

International companies importing to China encounter taxes levied by Customs across three primary categories:

  • Customs duties
  • Import-related value-added tax (VAT)
  • Consumption tax

Customs Duties: Since January 1st, 2019, customs duties have been applied to a reduced range of 8,549 taxable products, subject to annual revisions under the Tariff Implementation Plan. Starting from January 1st, 2024, 1,010 items have enjoyed a provisional tariff rate, which is lower than the MFN (most-favored-nation) tariff rates, and some are even eligible for a zero tariff.

Import-related Value Added Tax (VAT): Commencing April 1st, 2019, imported products incur either a 9% or 13% VAT. Notably, these rates have undergone successive reductions from their original figures of 11% and 17%.

Consumption Tax: Applicable to companies importing taxable merchandise such as tobacco, alcohol, jewelry, cosmetics, cars, and motorbikes. The tax rate varies based on product type and may be calculated using ad valorem or quantity methods.

The front of the China Import & Export Fair (Canton Fair, 2015)

Understanding Duties:

Import Duties: Import customs duties are categorized based on various criteria:

  • Most-Favored-Nation (MFN) duty rates
  • Conventional duty rates
  • Special preferential duty rates
  • General duty rates
  • Tariff rate quota (TRQ) duty rates
  • Temporary duty rates

Export Duties: Export duties are imposed on a limited range of resources and semi-manufactured products, often with temporary rates subject to time limits.

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Key Consideration:

Technical equipment importers benefit from exemptions on key components and raw materials listed in the Catalogue of State-supported Key Technical Equipment and Products since January 1st, 2019.

Navigating Chinese customs regulations requires meticulous attention to detail and a thorough understanding of the evolving landscape. By staying informed and leveraging available resources, businesses can optimize their import-export processes and ensure compliance with Chinese customs laws.

Have you thought of Outsourcing Supply Chain Management in China? At PTL Group, we specialize in managing the supply chain and distribution for international companies engaged in trade with China. Our team of logistics and finance experts is dedicated to providing comprehensive support, including trade compliance, importation process analysis, execution, and import/export VAT refund management. Read more about our Logistics Fulfillment & Distribution Services in China. 

For inquiries or further assistance, please don’t hesitate to contact us.

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