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The Ministry of Finance announced on the 15th that the Customs Tariff Commission of the State Council reviewed and passed the report and submitted it to the State Council for approval. From July 1, 2006, China will further reduce the number of automobiles and their parts and components based on the Tariff Reduction Commitment of the World Trade Organization. Import tariff rates.
According to the Ministry of Finance, the import tax rate for cars, off-road vehicles, and minibuses will be reduced from 28% to 25%, and the import tax rates for Auto Parts such as bodywork, chassis, and low- and medium-displacement gasoline engines will be
13.8% to 16.4% to 10%.
The Ministry of Finance said that up to this point, China's accession to the World Trade Organization promised tax reduction commitments for automobiles and their parts have been completed.
This is the second time in six months that China has announced the reduction of import tariff rates on some cars and their parts and components. In December last year, China reduced the import tariffs for more than 100 tax items such as automobiles and auto parts, vegetable oils, and chemical raw materials from January 1 this year.
However, not long ago, the European Union believed that China’s levying the same tariff as a complete vehicle on parts and components equal to or exceeding 60% of the vehicle’s value was in fact equivalent to disguising the “localization rate†of parts and components in violation of the relevant WTO regulations. And resorted to the WTO dispute settlement mechanism.
China believes that the above provisions are mainly designed to prevent some foreign auto makers from "tax evasion in disguise." Some foreign automakers will dismantle the imported vehicles and then assemble them at home so as to avoid imposing higher import taxes on vehicles.
Regarding the EU's recourse to the WTO dispute settlement mechanism, the Ministry of Commerce of the People's Republic of China issued a statement on April 8 expressing "regret" and announced that Ambassador Sun Zhenyu, the Chinese Permanent Delegation to the WTO, sent a letter to the EU and the U.S. delegation to the WTO delegation on the 7th. , indicating that China accepts European and American requests for consultations on China's auto parts import regulations under the WTO dispute settlement mechanism.