AustCham Beijing’s General Manager Nick Coyle Featured in The Australian

This week it has come to light that the China-Australia Free Trade Agreement (ChAFTA) will not necessarily protect Australian exporters from China’s newest imposition on goods sold online. From April 8, there will be a 17% value-added tax (VAT) on 70% of the value of a variety of goods sold online in China. The initiative is aimed at equalling out the playing field between Chinese online giants and China’s retail sector. This policy will apply the VAT, at first for a test period, to 70% of the value to goods that consumers buy for less than $400 per purchase, or alternatively that amass to an annual total under $4000. Above this threshold the VAT applies to the full value and an import duty will be imposed.

AustCham Beijing’s General Manager Nick Coyle has weighed in on the subject, balancing the positives and negatives of this change for Australians. Coyle suggested that in the short term this change may involve some increased compliance costs for Australian businesses and a few local alternatives may erode the competitiveness of imported products. However, he articulates, “generally speaking local products are much cheaper anyway and ChAFTA will ensure that our products are not subject to as much import duty, which will also apply once $4000 has been reached, as (with) most of our competitors.”

To read the full article, please follow the link to The Australian official website.