Starting from July last year, China made a series of adjustments in export tax rebate policy, mostly slashing it down so as to relieve pressure resulting from RMB appreciation and related factors.
However, it has been noted that this move has not greatly helped textile industry and the traders, especially exporters, are continuously bearing losses.
In 2007, average rate of sales profit of the industry was about 3.97 percent, whereas, in the first two months of this year it was only 3.4 percent. Experts have estimated that with an increase of 2 percent in export tax rebate, profit margins of the textile industry would climb by 0.6 percentage points.
Sources reported that Government was considering raising export rebate for Chinese textile industry from 11 to 13 percent and that for clothing sector from 11 to 15 percent. However, it is not yet decided when these new adjustments would be put into effect.
Recently, it was informed that raising the rebate rate was most unlikely move but that several support policies and favorable scheme will be issued.
Fibre2fashion News Desk - China
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