Reducing import tariffs affects geometry.

The the State Council executive meeting held recently pointed out that the import tariffs on daily consumer goods should be lowered on a large scale to better meet the diversified consumption needs of the masses. At the routine briefing on the State Council policy held by the State Council Information Office on June 1st, Vice Minister of Finance Zhu Guangyao introduced the relevant situation.

On May 31st, the State Council Customs Tariff Commission issued an announcement to reduce the import tariffs on consumer goods, which will take effect on July 1st this year.

Why should the import tariffs on consumer goods be lowered on a large scale this time? In this regard, Zhu Guangyao introduced that consumer goods for daily use are closely related to people’s needs for a better life. At present, the average MFN import tariff rate of consumer goods in China is 14.5%, which is 9.8% higher than the general tariff level in China. In 2017, China’s general trade import of consumer goods was US$ 65.7 billion. Since 2015, with the approval of the State Council, China has reduced the import tariffs on daily consumer goods for four times in order to attract overseas consumption back and meet the needs of residents’ consumption upgrading, mainly considering the high-quality products that are concentrated in consumption abroad and cannot be supplied at home for a while, including woolen clothes, some shoes and boots, sunglasses, thermos cups, diapers, some special foods and health care products.

It is understood that this tax reduction, in addition to appropriately reducing some products that have been significantly reduced in the previous period, plans to greatly expand the scope and intensity of tax reduction for other consumer goods, including products that are relatively few in consumption abroad but have distinctive advantages abroad, and products with relatively high import tax rates, involving 1,449 tax items, which is seven times the total of the previous four tax reductions. The average tax rate decreased from 15.7% to 6.9%, with an average decrease of 55.9%.

"Reducing import tariffs on consumer goods is conducive to expanding the import of products with distinctive advantages, meeting the needs of people’s better life, and better embodying the people-centered development concept; It is conducive to creating a fair competitive market environment and deepening the structural reform of the supply side of consumer goods; It is conducive to further opening up and is a major measure and practical action for us to actively open up the market. " Zhu Guangyao said.

Regarding the reduction of import tariffs this time, everyone is very concerned about whether the prices of consumer goods with concentrated demand from the people can continue to decline. In this regard, Zhu Guangyao explained that lowering tariffs did reduce the import cost to a certain extent, which generally helped to lower the price in the domestic market.

"At the same time, we should also look at it objectively. Tariffs are levied according to the import price of goods rather than the domestic market price. Reducing taxes on mass consumer goods priced on the basis of cost can promote market price reduction. However, for high-end consumer goods, the market sales price is usually several times the import price. " Zhu Guangyao said.

"After reducing tariffs, whether the price of consumer goods is reduced and how much it is reduced does have market behavior. We hope to enrich domestic consumption choices by reducing import tariffs and expanding imports of consumer goods. We hope that tax reduction can promote the decline of consumer goods prices, so that policy dividends can be truly transmitted to consumers and our consumers can get more benefits. " Zhu Guangyao said. (Reporter Yang Liang)