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Tariff Rebate System of China
■ Summary and Conceptual Distinction
ㅇTariff Rebate refers to the refund of the already paid tariff due to some reasons.
ㅇThe types of tariff rebate are the over-levied tariff rebate, which is to return the tariff levied by mistake due to certain errors, and the tariff rebate in its original meaning, which is to return the levied tariff when the imported commodities that have paid the tariff are re-exported.
ㅇTariff rebate and the value-added tax rebate shall be distinguished, and there is the description of the value-added tax rebate rate and its specification in the column of the value-added tax rebate. In China, it is often appeared that the value-added tax rebate and its rate are inconsistent with each other, and therefore the value-added tax rebate is significant.
■ Tariff Rebate System & Tariff Exemption System
It is called original tariff rebate system to pay the corresponding tariff first and to rebate the corresponding tariff after the re-export of the imported specific items, components and parts, and raw materials, etc.
On the other hand，the system that to exempt the tariff of the imported specific items, components and parts, raw materials, etc. which are predetermined for re-exportation, and then to finally determine the tariff exemption after the re-export is called tariff exemption system (also called tax exemption and post-management system). The raw materials imported in this condition keep the tax payment retained, and stay bonded in bonded area, so the government shall carry out the strict post-management.
At present, China doesn’t adopt the tariff rebate system in its original meaning, and what is implemented in China is the tax exemption and post-management system, which is a significant feature.
Therefore, in China the tariff rebate system in its original meaning is nearly meaningless, and the following is just the specification of the over-levied tariff rebate caused by errors, etc.
■ Over-levied Tariff Rebate
The consignor and the agent of the import and export commodities could apply for the rebate of the over-levied tariff to the customs if finding being over-levied after paid the taxes like the tariff or value-added tax.
☉ The Reasons for the Rebate
ㅇThe tax being over-levied for the errors of customs or taxpayers
ㅇThe short shipment of the customs inspection-free import commodities which have paid the tax, verified by customs
ㅇThe commodities fail to be shipped and exported for certain reasons after having paid the export duty and apply for shutouts, verified by customs
ㅇUnder the following situations after the import commodities having paid the tax
- Suffered the damage or loss in the overseas transportation or unlading process
- Suffered the damage or loss after unlading for the force majeure prior to customs clearance
- Being damaged or decayed in the customs inspection, which proved not caused by improper storage.
- Customs approved situation that under the preferential tariff reductions in import and export process, enterprises failed to submit and inspect that relevant certificates can make it up after tax collection(but required VAT certificate has been sealed with “deduction” by tax authorities can not apply for tax rebate）
☉ Laws and Regulations Basis
The Customs Law of China and Regulations of China on Import and Export taxes
☉ Required Materials
ㅇApplication form for tax rebate
ㅇThe original of the certificate of tax payment or the certificate of tax exemption
ㅇOther relevant certificates (Commodity Inspection Certificate, payment certificate, etc.)
ㅇIf submitting the tax rebate application and the relevant materials to the original taxation department, and the customs will conduct the verification after accepting the materials.
ㅇTo those applicant that meet the requirements, the customs will issue income refund notice, and such applicant shall provide it to the bank for tax rebate.
☉ Application and Time Limit
ㅇFor those over-levied ones, the application shall be filed within one year since the day of the tax being paid; for those post-refund application for the reduction or exemption of tax, the application shall be filed within three months since the day of the tax being paid.
ㅇThe time limit for Customs to conduct the tax rebate is 30 days since the day of application.