Intended to reduce difference with regular goods brought in from overseas
The government is mulling raising the tax levied on goods imported via cross-border e-commerce platforms in order to ensure a level playing field for traditional importers, Beijing-based newspaper Economic Information Daily reported Wednesday, citing an industry insider.
But experts noted Wednesday that the tax adjustment will not dampen the sector greatly.
The tax levied on goods imported via cross-border e-commerce platforms at present is the same level as the baggage and postal articles tax. The rate is about 30 percent lower than the tax imposed on goods imported via traditional channels.
The baggage and postal articles tax is levied on personal postal articles from overseas.
The news of the tax adjustment comes at a time when the cross-border e-commerce is experiencing rapid growth. The revenue of e-commerce transactions grew 39 percent year-on-year to 3.75 trillion yuan ($604.5 billion) in 2014, according to a report of the Ministry of Commerce on March 31.
The rapid development of cross-border e-commerce has affected normal imports, especially when it comes to consumer goods, as they are facing different levels of import taxes, Zhang Xiangli, an analyst at research firm iResearch, told the Global Times on Wednesday.
Zhang said that cross-border e-commerce removes the redundant procedures of traditional imports and decreases the cost, thus making it possible for consumers to buy the product at a much lower price. This advantage, along with the tax privileges, might lead to the unbalanced development of cross-border e-commerce and traditional imports.
According to the report from the Economic Information Daily, consensus has almost been reached among government authorities that the tax levied on cross-border e-commerce imports would still be lower than the tax on traditional imports even after adjustment.
Chang Xin, a marketing employee at a South Korean makeup brand which has a shop on cross-border e-commerce website tmall.hk, told the Global Times on Wednesday that the brand is considering raising prices after the tax adjustment.
But she also noted that the price increase is not likely to scare away customers.
"I assume the price wouldn't rise greatly," said Chang.
Zhang also said that e-commerce firms will still have a price advantage over traditional sellers after the tax adjustment.
Experts said that cross-border e-commerce is expected to continue to see rapid growth as the government has been encouraging the development of the sector, as a way of boosting the economy which is currently facing downward pressure.
A proposal was issued by the State Council that called on enterprises to explore the international market through cross-border e-commerce, Xinhua reported on May 12.
Zhang also said that cross-border e-commerce is still in an early stage of development and is immature in many ways.
"The government is making efforts to help standardize the industry," she said.
