The Policy Analysis of Cotton Sliding Duties in 2012
Author: Jan 05, 2012 10:24
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The Ministry of Finance issued on December 15, since January 1st, 2012, our country continues to implement the sliding duties for the beyond tariff quotas of importing a certain number of cotton, and are suitable for adjusting the tax formula of the sliding duties.
The policy evolution background of Sliding Duties
Since May 2005 to now, our country implements the system of sliding duties for the beyond tariff quotas of importing cotton. Compared with 2005, the sliding duties were adjusted for the benchmark price and target price in 2006, while it adjusted the calculation formula in 2007. The policy of sliding duties in 2008 which it determined after assuring the policy of sliding duties in 2007, which the formula of sliding duties keep unchangeable, while adjusted the content. In addition to this year of 5th, June to 5th, October which it implemented four months of temporary sliding duties, the methods of sliding duties in 2008 continued in a relatively stable state until the end of 2011. It was seen that the sliding duties in 2008 play a role the longest duration.
2012 sliding duties compared with 2008
Beyond the tariff quotas, the cotton import continues to carry out the sliding tax method. Whether it is the sliding duties of 2008 or 2012, it can be seen from the mathematical model, the tax rate and duty-paid price shown clear anti-correlation between the sliding intervals, the sliding duties reflect fluctuations in cotton prices, establishing internal and external linkage mechanism, it is also a certain interval smoothing fluctuations in the international cotton prices on the domestic impact of a control lever. In addition, the tax of sliding duties with the exchange rate which the relationship is as follows: the currency to appreciate, tax rates rise, local currency devaluation, tax rates down. The lever of sliding duties which the applicable tax rate has the difference in view of the different levels of imported cotton. Objectively, it has also adjusted by the imported structure. High quality low tax, low price high tax plays an important role in sliding interval on their influence.
It maintains the stability and continuity of tariff policy. The tax rate is consistent after adjustment. On the basis of the date of the exchange rate and foreign cotton prices, the sliding duties of 2008 and 2012 that the tariff rates are calculated 4% (the formula of sliding duties in 2008 has entered the quantity areas of duty-paid price. The tariff rate = 570/ duty-paid price).
Safeguarding the strategic interests of China's cotton industry
The sliding duties as a stable cotton industry in China’s economic systematic measures, in a word, the top of sliding is the specific tariff, and the below of sliding is suitable for the higher fixed tariff rate, which implement the sliding tariff during the sliding areas.
Firstly, the “derivation of tariff rate” of Specific Duties actually can be understood as foreign cotton prices continued to rise with the slope changes and the continuing slide, that is also said the overseas cotton price is higher, and the “derivation of tariff rate” is lower. For textile enterprise to reduce the cost of raw material is a kind of power, which is better than fixed tariff rate to help reduce the cost of imports.
Secondly, the price of overseas cotton is lower, and the rate of sliding duties is higher. For Western countries which subsidize the price of cotton under the policy is against unfair competition, to promote fair competition in cotton production.
Thirdly, for the cotton industry economic which “need to import cotton, textiles need to export, large dependence on foreign trade”, the measures of sliding duties is only a system,, which its policy goal is to create a positive and relaxed background to the competition, so that stabilizing and developing the cotton industry economic.
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Editor: sunny From: 168Tex.com
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