IPad import tax irks public

09:28, November 10, 2010      

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Faced with growing public complaints over a 1,000-yuan ($150) import tax imposed on each Apple iPad carried into the country, Chinese customs officials are planning to hold an online forum to address the issue.

Officials are apparently unsure whether the device, which is new to the Chinese market, should be classified as a personal computer or not. The tax, they say, is to deter smugglers, particularly from Hong Kong, where premium electronics are cheaper.

A WI-FI-enabled 16G iPad purchased from Apple's online store in Hong Kong sells for HK$3,888 ($500), or $97 cheaper than the same device purchased on the Chinese mainland for 3,988 yuan ($598).

Wang Hua, spokeswoman of the General Administration of Customs, wouldn't give a date when the forum would be held.

Apple China spokeswoman, Carolyn Wu, declined comment on the issue Tuesday.

The controversy was further complicated last month when the Ministry of Commerce joined the debate by questioning the accuracy of the tax rate that custom's officers are tacking onto iPads, the Beijing News reported Tuesday.

The import tax rate imposed on the iPad, which is currently classified as a personal computer, should be 17 percent, at most, instead of the current 20 percent. And the iPad's tax calculation should not be based on the Custom's value of 5,000 yuan ($750), as that amount exceeds the retail price of basic models, the newspaper quoted a ministry official as saying.

The iPad is among 20 dutiable items, including computers and cell phones that in-bound travelers are taxed on - regardless of whether the device is for personal use or not. The tax regulations on computers had been loosely enforced until Customs announced a crackdown August 19. Customs has issued a reminder that travelers must declare iPads or other devices when leaving the country, or they may get hit with the tax upon their return.

The commerce official was also quoted as saying the Customs' move is too heavy-handed on consumers that purchase the iPad device for personal use.

Ironically, it seems the smugglers are the real tax evaders, as opposed to the average Joe simply traveling with their own personal devices.

On the online shopping site taobao.com, the iPads can be ordered from unauthorized dealers in Hong Kong for cheaper than mainland prices.

One seller, surnamed Cheung, says in his posting, "You can order the iPad today and you don't need to pay additional taxes to Customs," adding that "We can help you" get around them.

Source: Global Times


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