China has recently increased the value of goods that may be imported duty-free and expanded the number of goods that may be imported via e-commerce. These changes should help foreign companies expand their e-commerce offerings into China.
Effective Jan. 1, 2019, China’s Ministry of Finance increased the value of goods that may enter duty-free in a single shipment from 2,000 CNY to 5,000 CNY ($300 to $750). In addition, the accumulated value of goods that may enter duty-free over a year was increased from 20,000 CNY to 26,000 CNY ($3,000 to 3,900). The e-commerce retail import product list was also recently updated, with the number of eligible products now totaling 1,321.
China’s cross-border e-commerce channel is a unique and complex regime, and there are numerous rules and regulatory requirements to meet to successfully register and become a qualified e-commerce enterprise in China. The following points provide additional information on this regime and the above changes.
- Products imported via e-commerce are administered as imports for personal use and the individual is liable for applicable duties and taxes. These products are generally free of initial entry permit/license and registration requirements.
- Companies must meet relevant qualifications to become eligible e-commerce importers; these can be e-commerce enterprises, e-commerce platform enterprises, and logistics companies such as couriers and postal operators. E-commerce importers must withhold and pay all requisite duties and taxes.
- If a personal purchase meets one-time and one-year accumulated value limits, duties are waived but the applicable value-added tax/sales taxes are reduced to 70 percent of those established for commercial imports.
- If the value of a single product declared for e-commerce import is greater than 5,000 CNY but less than the 26,000 CNY annual limit, the product will be assessed full duties and taxes as prescribed for commercial imports.
| E-Commerce Import Channel | Administration & Supervision | License | Duty* | VAT* | Sales Tax* |
| One-time purchase less than 5,000 CNY Annual accumulated purchases less than 26,000 CNY | Personal item (个人物å“) | Waived (with certain exceptions) | Zero duty rate (waived) | 70% | 70% |
| One-time purchase greater than 5,000 CNY (for one single item) but less than 26,000 CNY | Personal item | Waived (with certain exceptions) | 100% | 100% | 100% |
| One-year accumulated purchases greater than 26,000 CNY | Commercial goods (货物) | Not waived | 100% | 100% | 100% |
For more information or assistance researching practical options and developing an effective e-commerce strategy for the Chinese market, please contact Colbert Lam or Harry Zhang.