On November 15, 2024, China changed its export tax rebate policy. They canceled tax rebates for aluminum, copper, photovoltaics, batteries, and some non-metallic mineral products. It will be implemented from December 1, 2024.
As part of the aluminum products industry, 24 aluminum codes have been canceled for export tax rebates. These codes cover most domestic aluminum profiles, sheets, strips, foils, bars, and other aluminum products. The end of aluminum export tax rebates will raise costs for aluminum companies. This may lead to fewer aluminum exports from China and higher prices for aluminum abroad.
“Cancellation Of Export Tax Rebates” On Chinese Aluminum Products Companies
In the short term, China will end the export tax rebate for aluminum products. This will raise the export costs for Chinese aluminum companies. As a result, domestic companies may feel less excited about exporting.
There will be more aluminum available in China, which will lower domestic prices. However, this change will likely raise aluminum prices in other countries.
Tax rebates cancellation includes 94% of China’s aluminum exports, which is a wide range. In the short term, domestic aluminum supply prices are under huge pressure.
Specifically, exports of aluminum sheets/strips, aluminum foil, and aluminum bars and profiles will all suffer big losses. Chinese aluminum export companies must increase processing fees to avoid losses.
| Cancellation of Tax Refund Aluminum Material List | |||
| Product Code | Product Name | Export volume in the first three quarters （ton） | VAT refund rate before adjustment% |
| 76042100 | Aluminum alloy hollow profiles | 440,310 | 13.0 |
| 760429101 | Columnar solid aluminum alloy (the ultimate tensile strength at 293K (20 degrees Celsius) can reach 460 MPa (0.46×10^9 Newton/square meter) or greater) | – | 13.0 |
| 76042990 | Other aluminum alloy profiles and special-shaped profiles | 308,879 | 13.0 |
| 76061121 | Aluminum-plastic composite non-alloy aluminum rectangular plates, sheets and strips, 0.30mm≤thickness≤0.36mm | 5,299 | 13.0 |
| 76061129 | Other non-alloy aluminum rectangular plates, sheets and strips, 0.30mm≤thickness≤0.36mm | 18,352 | 13.0 |
| 76061191 | Other aluminum-plastic composite non-alloy aluminum rectangular plates and sheets, thickness> 0.2mm | 46,401 | 13.0 |
| 76061199 | Other non-alloy aluminum rectangular plates and sheets, thickness＞0.2mm | 277,182 | 13.0 |
| 76061220 | Aluminum alloy rectangular plate, sheet, 0.2mm＜thickness＜0.28mm | 935,679 | 13.0 |
| 76061230 | Aluminum alloy rectangular plates and sheets, 0.28mm≤thickness≤0.35mm | 98,219 | 13.0 |
| 76061251 | Aluminum alloy rectangular plates and sheets of aluminum-plastic composite, 0.35mm＜thickness≤4mm | 216,221 | 13.0 |
| 76061259 | Other aluminum alloy rectangular plates and sheets, 0.35mm＜thickness≤4mm | 579,762 | 13.0 |
| 76061290 | Aluminum alloy rectangular plates and sheets, thickness ＞4mm | 247,806 | 13.0 |
| 76069100 | Other non-alloy aluminum plates, sheets and strips, thickness > 0.2mm | 43,447 | 13.0 |
| 76069200 | Other aluminum alloy plates, sheets and strips, thickness＞0.2mm | 68,487 | 13.0 |
| 76071110 | Unprocessed aluminum foil without backing after rolling, thickness ≤ 0.007mm | 238,571 | 13.0 |
| 76071120 | Unprocessed aluminum foil without backing after rolling, 0.007mm＜thickness≤0.01mm | 47,443 | 13.0 |
| 76071190 | Unprocessed aluminum foil without backing after rolling, 0.01mm＜thickness≤0.2mm | 442,709 | 13.0 |
| 76071900 | Other unbacked aluminum foil | 221,202 | 13.0 |
| 76072000 | Aluminum foil backing | 196,837 | 13.0 |
| 76081000 | Non-alloy aluminum tube | 14,467 | 13.0 |
| 76082010 | Aluminum alloy tube, outer diameter ≤ 10cm | 83,904 | 13.0 |
| 76082091 | Aluminum alloy tube, wall thickness ≤ 25mm, outer diameter ＞10cm | 6,789 | 13.0 |
| 76082099 | Aluminum alloy tube, wall thickness>25mm, outer diameter>10cm | 3,295 | 13.0 |
| 76090000 | Aluminum pipe accessories (e.g., fittings, elbows, sleeves) | 26,827 | 13.0 |
| Note: China’s HS code is 10 digits, of which the first 8 are called the main code and the last two are called the additional code. Among them, the main code of HS 7604291010 is HS 76042910. In the first three quarters, China exported a total of 51,701 tons of aluminum alloy bars and rods (HS 76042910). | |||
“Cancellation Of Export Tax Rebates” On Import Aluminum Company
The cancellation of tax rebates has raised the cost of aluminum products from China. As a result, foreign importers now pay higher prices for these products. Foreign companies will also look for new suppliers.
Aluminium prices went up over the weekend. This happened after China said it would stop tax rebates on aluminium exports. As a result, shares of aluminium manufacturers rose on Monday.
Text: “`National Aluminium Corp. of India increased by 8.6 percent. Hindalco went up by 3.8 percent. Vedanta Corp. rose by 3.2 percent.“` Aluminium prices rose more than 2 per cent in the Multi Commodity Exchange (MCX) spot market.
What can foreign importers do before the Chinese government cancels the aluminum tax rebate policy?
As an aluminum product manufacturer, I recommend that foreign companies buy more products now. This is important before the tax rebate policy ends. Increasing inventory can help companies cope with rising costs.
Or negotiate more favorable prices with your trusted Chinese suppliers and share the additional costs of tax rebates. You can also allocate part of your orders to countries or regions with lower tax rates to optimize import costs.
The tax rebate for aluminum raw materials has been cancelled. However, you can still process aluminum into higher value-added finished or semi-finished products in China. After that, you can export these products. Some high value-added products may have lower taxes.
You can consult FTZ to benefit from the free trade zone’s special policies. These include delayed tariff payments and tax exemptions.
How To Import Aluminium After Cancelling Tax Rebate
China will officially implement the policy of canceling tax rebates for aluminum products from December 1, 2024. As a customer, how should you reduce import costs?
If you don’t want to change your Chinese partner, you should renegotiate the price. Try to get a better ex-factory price and discounts by signing a long-term cooperation agreement.
You can take advantage of China’s special trade policies. Import aluminum into the bonded area for processing before exporting it. This method may enjoy tax exemption or delayed tax payment.
You can import high-value aluminum products from China. This includes finished or semi-finished products. This way, you can avoid the effects of the aluminum tax refund on raw material imports.
If you don’t want to import from China, you should look for aluminum producers in other countries. Consider places like India, Vietnam, and Malaysia. You may not know the new supplier well, so you need to purchase from multiple regions to spread the risk.
If your country has a free trade agreement with others, you can import from that country. This is because it will have lower tariffs or no tariffs at all.
Another way is to change your need for aluminum raw materials to finished products. You can use aluminum parts or structural parts. You could also choose other metals to lessen your reliance on aluminum.
