Cotton Import Quotas of 1.5mn tons to be Issued
Source: Fibre2fashion Date: 2007-04-19
According to sources from textile industry, the additional 1.5 million tons of cotton import quotas under slide tax might be delivered to enterprises this week.
The so-called sliding tax system is based on different prices of imported goods; it sets different rate level for imported goods. The high price is applicable to a low tax rate and low price is applicable to a high tax rate. Its ultimate goal is to maintain price stability after-tax value.
According to the new slide tax policy of 2006, the formula is as follows:
Ri=IMT[(Pt/(Pi*E)-1)*1000+0.5]/1000,Ri40%
Of which, Ri is provisional tariff rate (when Ri is higher than 40%, we take 40%) E is US dollar exchange rate (We use 8.1 in the above calculation), Pi is the price before tariff (USD / per metric ton), Pt is constant, is 10,746 (1+5%), IMT is integer function.
In addition to the 894,000 tons of import quotas released at the beginning of the year, the total cotton quotas of 2007 will reach 2.394 million tons.
Quotas and imports will become one of the factors that cannot be ignored in domestic cotton market during the second half of the season and the rest of nine months of 2007.
