The announcement by the Chinese Foreign Ministry announced rebates on value added tax (VAT) of steel exports. The announcement also declared cut in import duty for ferrous scrap. The moves are aimed at discouraging steel exports and promote imports of steelmaking raw materials.
The administration has cut import duty on pig iron, crude steel and ferrous scrap to zero effective May1, 2021. Also, VAT rebates on exports of as many as 146 steel products, including hot rolled coil, wire rod, rebar, cold rolled steel sheet, hot-dip galvanized sheet and narrow strip, has been removed with effect from the same date. Accordingly, the 13% rebate will no longer exist.
The country had exported 53.67 million mt of steel products during the entire previous year, of which major product categories include hot rolled coils and wire rods.
Meantime, the rebate, introduced almost a year back, on some other steel products such as cold-rolled coil and hot-dip galvanised steel, has been kept unchanged, although industry was anticipating a reduction in VAT rate from current level of 13% to 4%.
The Chinese Ministry also raised export duty on high silicon steel from 20% to 25%. Also, the duty on ferrochrome and foundry pig iron has been raised from 15% and 10% to 20% and 15% respectively.
