Booms, Busts, and Recoveries Message Board

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Strategies & Market Trends : Booms, Busts, and Recoveries

Public Reply Prvt Reply Mark as Last Read File

Previous 10 Next 10 Previous Next

To: TobagoJack who wrote (41302)	11/13/2003 8:34:13 PM
From: ajtj99	Read Replies (1) of 74559

Challo and Jay, the change January 1st is a change in the way exporters are rebated the 17% VAT. Currently, the exporter can get a rebate of all or a portion of the 17% VAT, depending on the item being exported. For example, textiles exports qualify for the entire 17% VAT to be rebated, but that will change to 13% after Jan. 1st. Automotive related items also will have the same change. Tools and Machinery change from 15% rebate to 13% rebate. The average change is 3%. The effect will be price increases across the board for items purchased from China. In the ideal case, each party in the transaction will share the burden of the increase (example: factory 1%, exporter 1%, and customer 1%). Most situations are going to be less than ideal, however. I hope this answers your question. The net effect will be an increase in the price of Chinese products without a change in the pegged currency exchange. The government will also collect more money in revenue as a result of the reduced rebate.

Report TOU Violation

Share This Post

Public Reply Prvt Reply Mark as Last Read File

Previous 10 Next 10 Previous Next