China’s industrial profits return to growth

Beijing, March 27 (IANS) Profits of China’s major industrial firms rose 4.8 percent year on year in the first two months of 2016, reversing the downward trend of last year, official data showed on Sunday.

Profits at industrial companies with annual revenues of more than 20 million yuan (about $3.1 million) totalled at 780.7 billion yuan in the January-February period, the National Bureau of Statistics (NBS) said.

The profits registered a 4.7 percent year-on-year fall in December and a 2.3 percent annual decrease in 2015, Xinhua news agency reported.

He Ping, an official with the NBS Department of Industry, attributed the latest profit growth to increased sales and a milder decline in factory product prices.

In the first two months, revenues from the firms’ primary business climbed 1 percent year on year, improving from a 0.6 percent drop in December 2015 and a 0.8 percent increase for last year.

In the January-February period, China’s producer price index, which measures prices of goods at factory gate, slipped 5.1 percent year on year, narrowing from a drop of 5.9 percent in December and 5.2 percent for 2015.

Despite the recovery, part of the industrial profit growth was a result of the lower base in the same period of last year, He noted.

Industrial profits dipped 4.2 percent year on year in the Jan.-Feb. period of 2015, NBS data showed.

Compared with the same period of 2014, the Jan.-Feb. industrial profits of this year only inched up 0.4 percent, He added.

China sets new online import tax rules

China will change the tax rules on online retail goods from April 8 to level the playing field for e-commerce platforms and traditional retailers and importers, a media report said on Sunday.

Retail goods purchased online will no longer be classified as “parcels,” which enjoy a “parcel tax” rate, lower than that on other imported goods. Instead, online purchases from overseas will be charged in the same way as any other imported goods, the ministry of finance (MOF) announced.

“Parcel tax is not for trade purposes, which is exactly what online retailing is. It is unfair to conventional importers and domestic producers,” said Zhang Bin of the Chinese Academy of Social Sciences.

China levies parcel tax on imported goods worth less than 1,000 yuan ($150), and the rates is mostly 10 percent. Taxes under 50 yuan are waived, the People’s Daily reported.

As demand for overseas goods grows, online purchasing agents have taken advantage of parcel tax and used new methods such as repackaging and mailing products separately to avoid tax.

The new policy only allows a maximum of 2,000 yuan per single cross-border transaction and a maximum of 20,000 yuan per person per year. Goods that exceed these limits will be levied the full tax for general trade, the MOF said.

The new policy will speed up customs clearance so consumers will receive most orders from overseas within two weeks, instead of the current two months.

The expansion of the pilot zones came at a time when the country is facing sluggish foreign trade. Total export and import value for 2015 decreased 7 percent year on year, falling for the first time in six years.

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