The consumption tax collection link of high-end watches has moved back. Do you have to spend more?

Zhongxin Jingwei Client, March 13th (Zhang Yannan) On the 13th, the National Development and Reform Commission and other 23 departments announced the "Implementation Opinions on Promoting Consumption Expansion and Quality Enhancement and Accelerating the Formation of a Strong Domestic Market", including the adjustment and optimization of some consumption tax items , The consumption tax of high-end watches, precious jewellery, jewellery and jade was moved from the import link to the retail link .

Photograph by Xin Jingwei and Xiong Jiali

Senior Researcher of Minsheng Bank Research Institute, Mr. Ying Xi, told the client of Sino-Singapore Jingwei that the shift in the taxation link is mainly to encourage local governments to better improve the local business environment , promote consumption, and expand domestic demand.

Yang Chang, a senior economist and head of the policy group at the China-Thailand Securities Research Institute, said that this measure is a concrete implementation of the previous consumption tax reform, and the advantage lies in a larger tax base.

The client of China and Singapore Jingwei noted that on October 9, 2019, the State Council issued and issued a plan to adjust the central and local revenue after the implementation of a larger tax and fee reduction plan. The current consumption tax items collected in the production (import) link are gradually moved to the wholesale or retail link, which will expand local sources of income and guide the local to improve the consumption environment. The specific adjustment items have been fully demonstrated and implemented steadily after being submitted for approval one by one. The reform of high-quality watches, precious jewellery, jewellery and jade is implemented first, and the reform of other eligible items is carried out in combination with the consumption tax legislation.

In recent years, tax and fee reductions have been the key words of the Chinese economy. Large-scale tax and fee reductions have also put greater pressure on the fiscal balance. At the same time, the increase in expenditures on public services and social security has highlighted the importance of reducing the pressure on revenue and expenditure of local governments, especially those in financially difficult regions, and strengthening local governments' ability to respond to tax and fee reductions through reforms.

Yang Chang told the client of Sino-Singapore Jingwei that clarifying the collection of the consumption tax levy will help expand the consumption tax base. "If it is levied only at the import stage, it is only levied an import tax; if it is levied at the retail stage, if the price of goods increases, the tax base will become larger , which is a good thing."

According to Xiwen's analysis, whether it is production or import, regional concentration is relatively high, and retail is scattered in various places, which is directly related to regional real economy, residents' income, and business environment and other factors. The shifting of the taxation link can encourage local governments to better improve the local business environment and promote consumption .

Some netizens asked, "Is it more expensive to buy luxury goods?" "Not everything is subject to consumption tax, so don't be surprised" ...

Netizen comment screenshot

In this regard, Huang Yu, a macroeconomic researcher at Huarong Securities, said that the shift in the collection of the consumption tax will not have a significant impact on consumption and fiscal revenue (Jewelry consumption above designated size accounts for only about 2%). If the tax rate and collection method remain the same, shifting the collection link back may increase the final product price. Therefore, the market game of the related consumer goods industry may change the profit distribution and business model of the wholesale and retail links. The implementation opinions should be understood from the long-term perspective of improving the fiscal system and enhancing local fiscal strength. This should also be the direction of future consumption tax reform. At present, the short-term impact is limited.

However, Yang Chang said that there will also be some problems, and put forward requirements on the intensity of tax collection and management. It also involves how to allocate tax sources between the central and local governments. Because if it is moved to the retail sector to collect, it is the place to play the role of collection and management . So can the taxation efforts be added? It is also one of the concerns . (Zhongxin Jingwei APP)