Brief Guide to the Latest Import Duty Regulations in China

March 8, 2017
All Posts

In 2016, there were several changes in import duty regulations. Goods that are imported into the Chinese territory may be subjected to three types of taxes and duties: value-added taxconsumption tax and customs duty.

How to calculate the total taxes and duties when importing goods into China?

The formula for computing tax payable for imported goods is:

Tax payable = composite assessable price + applicable VAT rate

Composite assessable price = customs completion price custom duty

When the taxpayers import taxable goods under the consumption tax, the consumption tax payable will be included in the composite assessable price.

1.Value added tax for imported goods

Depending on the kind of goods, added VAT will be either at 13 percent or 17 percent.  The following table illustrates what kind of goods are VAT eligible and their VAT rate.

 VAT Taxable Items and Rate—Value Added Tax

(Source: Tax Policy Department, Ministry of Finance China)

 13% VAT

 Agriculture, forestry, products of animal husbandry, aquatic products; Edible vegetable and grain duplicates;

  • Tap water, heating, cooling, hot air supply, hot water, gas, liquefied petroleum gas, natural gas, coal/charcoal products for household use; books, newspapers, magazines (excluding the newspapers and magazines distributed by the post department);
  • Feeds, chemical fertilizers, agricultural chemicals, agricultural machinery and plastic converting film for farming;
  • Selected metal mineral products, selected non-metal mineral products, coal

 17% VAT

  •  Crude oil, mine salt and goods other than those listed above;
  • Taxable services

2.Consumption tax

The current system of consumption tax in China was implemented in 1994 via the Interim Regulations on Consumption Tax passed by the State Council in 1993. It was amended in 2008. On November 25, 2014, the MOF (Ministry of Finance) and the SAT (State Administration of Tax) jointly released additional adjustments. 4 types of goods were exempted from consumption tax. According to the latest adjustment, consumption tax can be applied to the listed imported items:

Consumption Tax – Taxable Items and Rates

 Source: SAT (State Administration of Tax, China)  

3.Duty rates on imported goods

Depending on the type of goods you import and the trading treaties the exporting country and China have, the duty will vary. Duty rates on imported goods is based on levels of trade agreements

Source: Dezan Shira

In the temporary duty rates released in 2016, custom duty has been removed from 30 types of goods. Custom duty rates were decreased for 8 types of goods, e.g. the duty rate for imported sunglasses decreased from 12% in 2015 to 6% in 2016.

That’s that for today,

Read more about our logistic solutions in China or Get in touch to get things moving.