Govt slams customs over tax

09:01, November 15, 2010      

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The Ministry of Commerce has accused customs officials of violating World Trade Organization (WTO) rules by imposing heavy taxes on electronic products brought by individuals into the Chinese mainland, even those meant for personal use.

  The ministry sent a letter to the General Administration of Customs (GAC), saying as a WTO member, China is obliged to waive taxes on computers and other electronic goods, and that the 20 percent levy imposed is excessive. Customs authorities responded by saying the levy is in line with international practice.

  The dispute emerged after customs issued a notice on August 19 saying anyone entering China with products worth more than 5,000 yuan ($753) is said to be taxed 20 percent.

  Many complained of being taxed after purchasing iPads or iPhones in Hong Kong.

  "I bought an iPad in Hong Kong, and I was asked to pay 1,000 yuan ($150) in tax," a man surnamed Wen told the Yangtze Evening Post, adding his iPad had cost less than HK$4,000 ($516).

  A postgraduate student in the UK surnamed Chen told the newspaper that she might have to sell her laptop computers and digital cameras before returning to China.

  The smuggling of iPhones and iPads is believed to be rampant as the items sell for much lower prices in Hong Kong than on the mainland.

  A 16-gigabyte iPad costs 3,988 yuan ($600) on the mainland, but only HK$3,888 ($501) in Hong Kong. A tourism industry insider told the newspaper that the discrepancy has resulted in a vibrant business for purchasing agents.

  Huang Yi, head of the supervision department of the GAC, told China National Radio that products close to 5,000 yuan will also be taxed 20 percent.

  "It is international practice to set a tax-free limit for products that people bring into the country. It is also common among other countries to impose taxes on products that exceed this level," Huang said.

  Huang also said the limit in China is similar to that of other developed countries.

  "It is the responsibility of the customs to protect the nation's economy and combat smuggling," Huang said.

  The head of the Hong Kong Tourism Board, James Tien, said he is concerned about the impact the tax will have on the city's tourism.

Source: Global Times


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