CHINA - 1 ° July 2018 - Reduction of duties in the automotive, clothing, household appliances and cosmetics sectors

Last May 22 the Chinese Ministry of Finance has published an announcement of the Council of State Customs Tariffs Commission that determines a reduction in the importation of vehicles for the transport of goods and people. The decision states that starting from the first of July, car imports will be subject to only two rates (previously there were five, differentiated between motor vehicles and components). The two new rates apply to vehicles for the transport of goods and people, for which a reduction from 25% to 15% is envisaged, whereas a single rate of 6% will be applied to chassis, bodywork and other parts for motor vehicles instead, they were subject to duties between 25% and 8%).
However, imports of cars continue to be subject to the "consumption tax" (from 5 to 40% depending on displacement) and to an automatic import licensing system.
The opening of the automotive sector was a long-awaited commitment to the national reform agenda and an important part of the "package" of liberalization includes the abolition of the mandatory ceiling for holdings in joint ventures for the production of cars. In this regard, last April the Government announced - with a note published by the National Development and Reform Commission - the intention to remove the limits on foreign ownership of JVs in the automotive sector - currently set at 50% - within the next 4 years. Within 2018, liberalization will affect the electric vehicle sector (new energy vehicles-Nev) and then be extended to other sectors within 2022.
In fact foreign car manufacturers will be able to produce in China without being obliged to make partnerships with local companies and to maintain a minority share.

Also starting from 1 ° July 2018 China will reduce customs duties on the import of about 1.500 products of the apparel, home appliances and cosmetics sectors. Customs rights apply to clothes, shoes, sporting goods and will be reduced to 7,1% from 15,9%, washing machines and refrigerators will drop to 8% from the current 20,5%; cosmetics and some health products at 2,9% from 8,4%.

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