Part of the Ministry of Finance's strategy to even up the operating burdens of online and offline retailers of imported goods, the new import tax system sees tax increases on 1,100 specific imported items. Among them are food, baby products, home appliances, cosmetics, and clothing. The increases are generally from 10%, 20%, 30%, and 50% to current levels at 15%, 30%, and 60%, depending on the specific product. Bulk tobacco, alcohol, luxury products, and cosmetics have seen the largest increases.
Overall, China is tightened its restrictions on overseas purchases that may be brought back into the country. PRC citizens may bring in duty-free articles for personal use worth a total of 5,00rmb. For non-citizens, it's 2,000rmb.
Basically, the new taxes make it less profitable to hop on a plane to South Korea, fill your suitcases with product, and then flip it all on your Taobao shop to your Chinese clientele when you come back.
This photo of (supposedly) discarded make-up at Pudong airport has gone viral.
"I'd rather throw them away than get taxed!" stated in the Weibo that spread the rumor.
The photo, of course, was proven to have been faked, but its not the only instance of online blow-back from the new tax regulations. Xu Youzhen, a CEO of a famous Chinese gaming company also shared his wife's unpleasant experience on Weibo, saying that customs in Shenzhen had abused this policy, confiscated the expensive coat she was wearing, and detained her till midnight.
A "daigou" girl (an online vendor of imported goods) got caught on the scene.
If the new policy doesn't directly affect you at the airport, the market ramifications of the increase in operating costs for online retailers might. Some online retailers have increased their prices as a result. Others have even claimed they have to shut down their online business because flight attendants have stopped bringing goods for them.
SmSh asked around to our friends who've recently been through the airport, and they've told us that it seemed customs officials were a little more zealous than they usually are with looking through peoples' stuff. It's hard to tell how strict they're being with it so far, however. People are reporting differing experiences on Weibo.
Still, something to be aware of the next time you touch down in Pudong with a suitcase full of Iberian ham or 9,000 Mac cosmetics kits.