High luxury taxes called counterproductive
Source: Xinhua |
March 2, 2013, Saturday
|
Print Edition
Print Edition
NETIZENS are questioning China's high luxury taxes after two people were sentenced to one year in prison with an 18-month reprieve for smuggling goods from overseas and selling them online.
The two vendors were caught in April and May, respectively, at Pudong International Airport in Shanghai when they returned from South Korea with hundreds of watches, handbags and cosmetics without declaring them.
Both planned to sell the goods on Taobao, China's most popular consumer-to-consumer sales platform.
Netizens have blamed high taxes on luxury goods for the increasing number of online vendors taking risks to bring goods into the country illegally.
"China collects a 10 percent customs duty, a 17 percent value-added tax and a 30 percent consumption tax for a European cosmetics product worth US$400," said Wang Weiqing, a professor at Shanghai Jiao Tong University.
"Baby formula sells for more than 30 percent higher in China than in countries like the Netherlands. That's why I've been buying baby formula from Taobao for the last two years," said an online shopper surnamed Zheng.
Research done by the China Electronic Commerce Research Center showed the market for overseas shopping services reached 48.3 billion yuan (US$7.8 billion) in 2012, which means it increased 82.2 percent year on year.
The figure is expected to reach 70 billion yuan this year.
Some worry that Taobao vendors and customers may get into legal disputes.
"I hope Taobao vendors will learn a lesson from the two people who were sentenced to one year in prison. They should not evade taxation for higher profits," said a netizen called Dajie Mars.
A netizen using the screenname Ayuan said customers risk buying fake products by using overseas purchase agents.
"Where do I return goods of inferior quality? I didn't buy the item in person from a shopping mall. The vendor could say he was not responsible for the item's quality because he only bought it on my behalf," said Ayuan.
Lu Xiao, a professor at Fudan University, said shopping malls in China should adjust their marketing strategies and offer more discount options to retain customers.
"The government should set up more duty-free shops and lower customs duties in order to encourage more people to shop in China," said Lu.
The two vendors were caught in April and May, respectively, at Pudong International Airport in Shanghai when they returned from South Korea with hundreds of watches, handbags and cosmetics without declaring them.
Both planned to sell the goods on Taobao, China's most popular consumer-to-consumer sales platform.
Netizens have blamed high taxes on luxury goods for the increasing number of online vendors taking risks to bring goods into the country illegally.
"China collects a 10 percent customs duty, a 17 percent value-added tax and a 30 percent consumption tax for a European cosmetics product worth US$400," said Wang Weiqing, a professor at Shanghai Jiao Tong University.
"Baby formula sells for more than 30 percent higher in China than in countries like the Netherlands. That's why I've been buying baby formula from Taobao for the last two years," said an online shopper surnamed Zheng.
Research done by the China Electronic Commerce Research Center showed the market for overseas shopping services reached 48.3 billion yuan (US$7.8 billion) in 2012, which means it increased 82.2 percent year on year.
The figure is expected to reach 70 billion yuan this year.
Some worry that Taobao vendors and customers may get into legal disputes.
"I hope Taobao vendors will learn a lesson from the two people who were sentenced to one year in prison. They should not evade taxation for higher profits," said a netizen called Dajie Mars.
A netizen using the screenname Ayuan said customers risk buying fake products by using overseas purchase agents.
"Where do I return goods of inferior quality? I didn't buy the item in person from a shopping mall. The vendor could say he was not responsible for the item's quality because he only bought it on my behalf," said Ayuan.
Lu Xiao, a professor at Fudan University, said shopping malls in China should adjust their marketing strategies and offer more discount options to retain customers.
"The government should set up more duty-free shops and lower customs duties in order to encourage more people to shop in China," said Lu.
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