Lever effects of adjustment in tax rebate rate show up

From July 1 this year，the central government began to adjust the rate of export tax rebate . This adjustment covers 2，831 kinds of commodities with 2% of reduction in the rebate rate on the average，around 37% of all on the customs tariff . According to the authority of state taxation，with the implementation of the new rate of tax rebate，the lever effects will gradually show up in the following periods，which could mainly be generalized in the following aspects：

First，the growth rate of export volume will decrease . The rise of cost in the export will lead to the narrowing of market share and the reduction of competitiveness in the international market . Besides，the cutting down of tax rebate rate will also prevent people’s deliberate exaggeration of their export volume in the declaration . Second，commodities with relatively higher tax rebate rate will take a larger percentage in the export . This tendency will be striking in the foreign-trade circulating enterprises，but the structural adjustment of the manufacturing enterprises wi ll come a bit late.Third，the proportion of processing trade will go up . Especially，commodities with low tax rebate rate ( say 5%) wi l l have more opportuni ti es in the processing export trade . Fourth，reshuffle phenomenon will occur inside the industry . Enterprises have different acceptability to the increased cost caused by lowering the tax rebate rate，which may lead to more order transfers and enterprise mergers .

The emphasis of the adjustment in the export tax rebate is placed on the structure . This adjustment serves as a signal for the structural adjustment of national industries as well as export commodities and offers a clear direction in the enterprises’adjustment of investment，said Lou Zhangneng，chief of Yiwu Municipal Bureau of Foreign Trade and Economic Cooperation . In general，this adjustment conforms to Yiwu’s developing target，for it helps increase Yiwu enterprises’pressure and motivation for technological innovation，thus transforming Yiwu export enterprises from profiting by quantity and low price to profiting through quality，high added value，and advanced technology . That will also be beneficial to the integration of the whole industry and the promotion of industrial level，shaping a mechanism of “survival of the fittest”for the export enterprises and export products，and enhancing the core competitiveness of Yiwu’s export trade.

This policy adjustment will have a great impact on Yiwu enterprises in a short period of time .Labor-intensive enterprises and low value-added products take a high proportion among Yiwu enterprises and Yiwu produc ts ，whi ch enjoy competitiveness with their low costs，but own small profit space as well as weak anti-risk ability . As a result，the foreign-trade circulating enterprises have to carry out big adjustments in both trade mode and operation direction.

Yiwu should make use of this opportunity to guide enterprises in promoting the level of industry，improving the innovative ability，and developing resources-saving and environment-friendly export products ，so as to strengthen international competitiveness，Lou Zhangneng said .