On 18 June 2007, the Ministry of Finance, the State Administration of Taxation, the State Development and Reform Commission, the Ministry of Commerce and the General Administration of Customs jointly issued a circular “Adjustment of the Tax Rebate Rates for Certain Exporting Products” [Caishui(2007)No. 90].  Starting 1 July 2007, tax rebate rates for certain exporting products will be adjusted.

According to the Notice, export tax rebates on the following products will be abolished:

l           Endangered animals, plants and products; salts, hexanes, cement, liquefied propylene, butane and petroleum gas; fertilizers; chlor and dyes; metal carbides and activated carbon products; leather; certain wooden boards and products; primoric carbon welded pipes and products; non-aluminium alloy bars, rods and other processing products; and other non-motor vessels.

The export tax rebate rates for the following products will be reduced:

Products	Export Rebate Rate After Adjustment (%)
Cases and bags, garments, shoes, hats, umbrellas, feather products, planing machines, chain mortiser, cutters machine and broaching machine, watches and clocks and toys	11
Furniture	9 or11
Diesel machines, pumps, fans, air evacuation valves and components, drying furnaces, furnaces, sewing machines, stapling machines, golf cars, snow vehicles, motorcycles, bicycles, trailers, lifts and components, taps and stick welding machines	9
Certain chemicals	5 or 9
Plant oils, plastic and rubber products, other leather and fur products, paper products, certain stones, ceramic, glass, pearls, precious stones and metallic products, certain iron and steel products, other base metallic products, certain wooden products and viscose fibres	5

No tax will be levied on the export of the following products:

l           Peanuts and nuts, oil paintings, sculpture boards, postage stamps and tax stamps.

New tax rebate rates will be effective on I July 2007 for the above-mentioned products. Reference will be made to the date of export as shown on the export declaration (for tax rebate) of the products.

For export contracts of vessels signed before 1 July 2007, the original export rebate rates will be applied provided that the enterprises register the export contracts at the tax rebate authority before 20 July 2007.  For contracts that have not registered by then, no rebates will be given.

For enterprises which have been awarded tenders for long–term projects or have signed long-term contracts for exporting equipments and construction materials at fixed prices, they should register their contracts by presenting proofs of the awarded contracts together with the project schedules with the tax rebate authority before 20 July 2007. In so doing, the original export rebate rates will be applied. For products that have not registered by the stipulated date, the new export tax rebate rates shall be applied.

For details of the Notice, members may visit the following website:

http://www.mofcom.gov.cn/aarticle/b/e/200706/20070604800599.html&38460017=222743092