China - e-Commerce tax changes effective


China's new rules that increase the taxes on goods imported online, which were jointly announced by the Ministry of Finance, the General Administration of Customs, and the State Administration of Taxation on the 24th March, went into effect on the 8th April 2016.

Retail products imported by consumers through online purchases used to be classified as "parcels," and were subject to a "personal postal articles tax" at a general rate of 10% for goods priced at less than RMB1,000 (EUR137). Tax payable of under RMB50 (EUR7) was waived.

The new tax rules have been introduced to create a more level playing field with other imported goods sold by Chinese domestic retailers. The rapid rise in cross-border e-commerce had seen online retailers taking advantage of the parcel tax framework by, for example, dividing product packages to avoid taxation.

From the 8th April, untaxed cross-border online transactions are limited to a maximum of RMB2,000 (EUR274) per transaction, and to RMB20,000 (EUR2740) per person each year. Goods exceeding those limits are treated as normal imports, and may be subjected to variable tariffs, a general 17% import value-added tax (VAT), and a consumption tax payable on luxury or non-essential items, such as alcohol, petrol, jewelry, and cars... Read More



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