China's Ministry of Finance has issued a notice regarding adjustments on import and export taxes, which will be effective as of January 1, 2015. However, the actual details of the adjustments have not been issued yet.
According to the notice, taxes will be lowered on imports of optical fiber-equipped communication devices, some advanced manufacturing equipment and electric car parts. Meanwhile, import taxes on ethylene, ferronickel and coal products will be lowered, though the specific decrease margins have not been clarified yet.
There have been rumors saying China will lower its export tax on coal from 10 percent to three percent, while this has not been officially confirmed yet. For commodities, 2014 has been a tough year, with prices of iron ore seeing a 50 percent drop and coal prices down by around 25 percent.
Market analysts have said the adjustments of export taxes for coal products will ease the oversupply situation in China and help stabilize coal prices. However, since Australia has captured China's previous export market share in Southeast Asia, even with reduced coal export taxes as of January 1, China is unlikely to regain its lost market share.
On the other hand, no official announcement has been heard yet regarding the export tax rebate on finished steel - an issue which the steel markets have been watching with great interest. However, sources tell SteelOrbis that it is strongly believed that the export tax rebate on finished steel will be removed.