VAT Rebates Coming Back for Textiles and Garments

While not announced yet by China, The South China Morning Post today has an article stating that VAT Rebates are coming back for textile and garment exports. This is a bit of a surprise move and is welcome news to those in the China textile and garment industries and for buyers seeking relief from higher prices.

For those unfamiliar with VAT rebates and their place within China sourcing, please have a look at this SourceJuice article Reminder: Understand VAT Rebates to Bargain More Effectively.

According to the article:

Various industry sources and tax experts say the mainland is finalizing a plan to raise VAT rebates on textiles and garments as much as 4 percentage points to 15 per cent. Generally, exporters are paying a value-added tax of about 17 per cent.

The plan also would increase rebates on viscose fiber - a key raw material in making fabric - as much as 1- percentage points to 15 per cent.

The plan signals a rescue of the country’s pillar industry, which is undergoing an unprecedented consolidation exacerbated by a United States-led global economic slowdown, a sinking US dollar and sourcing costs of raw materials, labour and crude oil.

When the VAT rebate returns, be sure to get the discount on your next purchase order!