China will expand a scheme to speed up tax refunds for companies that export via a Shanghai port, the government said, as it looks to boost the city’s role as an international shipping centre.
Exporters that send products abroad via Shanghai’s Yangshan deep water port, will from next month be able to recoup some taxes as soon as ships set sail for Shanghai from feeder ports in Nanjing, Suzhou, Lianyungang, Wuhu, Jiujiang, Qingdao, Wuhan and Yueyang.
Previously only Qingdao and Wuhan were included in the scheme, with tax refunds on goods sent from other ports of origin only paid when cargoes eventually left Shanghai.
“It’s good for (exporters) because they can get their money back earlier, which is positive for their cash flow and turnover,” said Han Ning, a China-based shipping consultant with Drewry. “It’s also good for Yangshan.”
Goods are often sent overseas via shipping hubs after being moved from so-called feeder ports.
Shanghai, home to the world’s busiest container port, is competing heavily to increase its share of such transshipment volumes against foreign ports such as South Korea’s like Busan, which offers incentives such as tax waivers.
The Ministry of Finance, the General Administration of Customs and the State Administration of Taxation announced the plan on Thursday.
Only companies with strong records for paying taxes will qualify for rebates, they said. Refunds could come on taxes including value added tax or consumption tax. (Reuters)