Textile Players Suggest Buffer Period for Tax Rebate Cuts
Source: Fibre2fashion Date: 2007-04-24
Recently textile and garment export tax rebate has been the subject of concern. Sources said the Ministry of Finance has proposed the adjustment program for textile and garment export tax rebates, planning to decrease the rebate rate on textile exports from 11 to 9 percent, on apparel from 13 to 9 percent and on chemical filament product from 9 to 5 percent.
Sources from China Textile Industry Association disclosed that the program has indeed submitted to the State Council and is expected to be published soon.
Relevant sources said, the State Development and Reform Commission’s proposal has textile export tax rebate rate remained unchanged, garment export tax rebate rate declined two points, from 13 percent to 11 percent. Another source said that this week the Ministry of Finance would discuss the issue of lowering rebate rate by several points.
China Chamber of Commerce for Import and Export of Textiles yesterday issued a report, "export trend of textile and garment this year", which noted that generally enterprises reflect strongly on RMB revaluation and further lessening export tax rebates.
Besides, continuing rise in prices of raw materials, labor, energy and other production elements will further squeeze the profit space of enterprises. Trade data shows that 2 percent reduction of export rebate is expected to result in 10 billion yuan loss in garment industrial profits.
The report also shows that many enterprises suggest setting up a buffer period of policy implementation, if further cuts in export rebate rate are made, so as to reduce the losses of garment enterprises.
