New Customs rules may end online buying from overseas
By Lu Nengneng |
April 20, 2012, Friday
|
Print Edition
Print Edition
Vicky Ye, 24, is a savvy online shopper who learned that ordering the latest gadgets and current fashions from Amazon.com and having the goods mailed from overseas was cheaper than buying the same merchandise locally.
But now that door is closing because of new Customs rules on personal packages mailed from abroad.
"The chances of getting any real bargains may become slim," Ye said. "News of the new rules convinces me that Customs is determined to tighten its grip on mailed imports."
Ye is among millions of Chinese online shoppers who have shared a dark, not-so-little secret: Having imports delivered through express mail services has helped buyers escape tariffs, though technically any inbound mailed valued at over 50 yuan (US$7.9) is subject to taxes.
As of last Sunday, however, the main handlers of packages mailed to China - both the big domestic postal companies and small overseas logistics companies - are covered by new rules that mean more checks on incoming goods.
"Imported goods handled by overseas logistics companies will have to get the Customs clearance as commercially delivered items instead of as personal mailed ones, which means stricter tariff is imposed," said a customer representative at USZCN, a US-based logistics company tailored for Chinese online shoppers.
There are scores of such companies serving as transfer stations of packages mailed from the US and Europe, where e-commerce websites usually don't support direct mail delivery to China. In the overseas online shopping community, these forwarders are known as "consultants" for consumers who want to dodge tariffs.
Ye said commercial express giants like DHL, TNT, UPS, and FEDEX normally declared all imported goods at Customs, while forwarders usually didn't on personal packages. The latter group suggested she split purchases into several smaller orders so they run less risk of being intercepted for Customs inspection.
"I was told to keep my packages as low-profile as possible in terms of size and weight," Ye said.
What happens now is a bit murky. Some operators are taking a wait-and-see approach until the new rules are clarified and the dust settles.
On April 1, USZCN suspended new member registrations for 25 days, while another big industrial player, Thunder Express, shut down its operations until April 13.
More have decided to raise their delivery fees and pre-charge tariffs. The price hike averages about 50 percent, with tariffs set according to a detailed rate and threshold list released by Customs.
"It's clear that Customs has tightened the enforcement of tariffs," a customer representative of forwarder Ship180 said, based on the experience of the past two weeks.
Besides regular delivery fees, the company now charges special fees for handling electronic wares such as laptops, mobile phones and e-book readers, which are now the main focus of the tax evasion crackdown.
The customer representative of Ship180 said paying special fees can add to the likelihood of smoother customs clearance, but they are no guarantee of tariff "exemption."
Another big forwarder Buytong recently put a notice on its website, suggesting honest customs value declarations for electronics. Its competitor 360Zebra said it has suspended electronics-goods deliveries for the time being.
Many forwarders are concerned that tightened surveillance of certain imports might just be the start of more surveillance. Customs may eventually put all product categories under close watch, shuttering their businesses for good.
Chinese overseas online purchase agents like Wang Lin, a 27-year-old woman living in Shanghai, are watching developments closely.
She runs a part-time cosmetics shop on Taobao.com, China's biggest e-commerce platform. Wang sources imported cosmetics through the same duty-free loopholes used by Ye and re-sells them at higher prices.
She started the business three years ago, after she discovered that many bargain hunters in China were unable to transact offshore deals themselves because of limited English skills and logistics know-how.
According to a report by the China e-Business Research Center, deals transacted through online purchase agents in China were valued at 24 billion yuan last year and that figure is expected to double by year's end. Cosmetics, milk powder and handbags are among the most frequently purchased items.
"The new customs clearance policy came as a heavy blow to us overseas purchase agents, who rely on "tax exemption" to gain advantage in China's retail competition," Wang said.
A bottle of Estee Lauder lotion is 20 percent cheaper at her online store than at offline cosmetics retailer Sephora. But Wang said she doesn't rule out having to raise prices as a last resort, if tariffs become a regular part of her business costs.
Wang said if her online prices rise to the same level as brick-and-mortar shops, then her business is sunk.
She has decided not to source any new "duty-free" merchandise after her forwarder said the chances of getting caught were increasing. Attempts to find some new delivery channels failed.
At this sensitive time, Wang manages to keep her business afloat by selling off goods shipped to China a month ago. But unlike Ye, she remains undaunted about the future for online, offshore bargains.
"Customs cannot possibly check every package," Wang said. "I guess it will still be a game of hide-and-seek."
But now that door is closing because of new Customs rules on personal packages mailed from abroad.
"The chances of getting any real bargains may become slim," Ye said. "News of the new rules convinces me that Customs is determined to tighten its grip on mailed imports."
Ye is among millions of Chinese online shoppers who have shared a dark, not-so-little secret: Having imports delivered through express mail services has helped buyers escape tariffs, though technically any inbound mailed valued at over 50 yuan (US$7.9) is subject to taxes.
As of last Sunday, however, the main handlers of packages mailed to China - both the big domestic postal companies and small overseas logistics companies - are covered by new rules that mean more checks on incoming goods.
"Imported goods handled by overseas logistics companies will have to get the Customs clearance as commercially delivered items instead of as personal mailed ones, which means stricter tariff is imposed," said a customer representative at USZCN, a US-based logistics company tailored for Chinese online shoppers.
There are scores of such companies serving as transfer stations of packages mailed from the US and Europe, where e-commerce websites usually don't support direct mail delivery to China. In the overseas online shopping community, these forwarders are known as "consultants" for consumers who want to dodge tariffs.
Ye said commercial express giants like DHL, TNT, UPS, and FEDEX normally declared all imported goods at Customs, while forwarders usually didn't on personal packages. The latter group suggested she split purchases into several smaller orders so they run less risk of being intercepted for Customs inspection.
"I was told to keep my packages as low-profile as possible in terms of size and weight," Ye said.
What happens now is a bit murky. Some operators are taking a wait-and-see approach until the new rules are clarified and the dust settles.
On April 1, USZCN suspended new member registrations for 25 days, while another big industrial player, Thunder Express, shut down its operations until April 13.
More have decided to raise their delivery fees and pre-charge tariffs. The price hike averages about 50 percent, with tariffs set according to a detailed rate and threshold list released by Customs.
"It's clear that Customs has tightened the enforcement of tariffs," a customer representative of forwarder Ship180 said, based on the experience of the past two weeks.
Besides regular delivery fees, the company now charges special fees for handling electronic wares such as laptops, mobile phones and e-book readers, which are now the main focus of the tax evasion crackdown.
The customer representative of Ship180 said paying special fees can add to the likelihood of smoother customs clearance, but they are no guarantee of tariff "exemption."
Another big forwarder Buytong recently put a notice on its website, suggesting honest customs value declarations for electronics. Its competitor 360Zebra said it has suspended electronics-goods deliveries for the time being.
Many forwarders are concerned that tightened surveillance of certain imports might just be the start of more surveillance. Customs may eventually put all product categories under close watch, shuttering their businesses for good.
Chinese overseas online purchase agents like Wang Lin, a 27-year-old woman living in Shanghai, are watching developments closely.
She runs a part-time cosmetics shop on Taobao.com, China's biggest e-commerce platform. Wang sources imported cosmetics through the same duty-free loopholes used by Ye and re-sells them at higher prices.
She started the business three years ago, after she discovered that many bargain hunters in China were unable to transact offshore deals themselves because of limited English skills and logistics know-how.
According to a report by the China e-Business Research Center, deals transacted through online purchase agents in China were valued at 24 billion yuan last year and that figure is expected to double by year's end. Cosmetics, milk powder and handbags are among the most frequently purchased items.
"The new customs clearance policy came as a heavy blow to us overseas purchase agents, who rely on "tax exemption" to gain advantage in China's retail competition," Wang said.
A bottle of Estee Lauder lotion is 20 percent cheaper at her online store than at offline cosmetics retailer Sephora. But Wang said she doesn't rule out having to raise prices as a last resort, if tariffs become a regular part of her business costs.
Wang said if her online prices rise to the same level as brick-and-mortar shops, then her business is sunk.
She has decided not to source any new "duty-free" merchandise after her forwarder said the chances of getting caught were increasing. Attempts to find some new delivery channels failed.
At this sensitive time, Wang manages to keep her business afloat by selling off goods shipped to China a month ago. But unlike Ye, she remains undaunted about the future for online, offshore bargains.
"Customs cannot possibly check every package," Wang said. "I guess it will still be a game of hide-and-seek."
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