B2C Direct Shipping Imports
As the second dedicated method for eCommerce shipping promoted by China government since 2014, B2C direct shipping imports only takes 24 hours to complete clearance, which reduces the total transit time to 5 to 12 days. Some logistic providers will handle the custom tax on behalf of the merchants. The parcels will be consolidated to bulky goods and freight forwarded to a China bonded area for swift custom clearance. At the same time, the merchant’s eCommerce website or selling platform needs to host Chinese payment methods like Alipay or WeChat Pay, as the China customs requires payment information from the payment company in order to validate the goods value.
Since the products are stored in merchants´ oversea warehouse, there is no initial shipping costs unless an order is placed. This offers the merchants a lot of inventory flexibility and often used in the beginning phase of CBEC selling to China. It is also often used by relatively high value items with smaller order numbers. Most of eTOC´s WeChat Mini Program Store merchants prefer to use this method.
Tax rates for CBEC, which applies for both Bonded Warehouse Imports and B2C Direct Shipping Imports:
The Chinese Ministry of Finance announced a new set of regulation affecting cross-border purchases. The new rules will take effect on the 1st of January 2019.
The main change of the new regulation is the increase of the cut-off amount for tax-free cross-border purchases:
Single-transaction amount increased from 2,000 RMB (256 EUR) to 5,000 RMB (641 EUR)
Yearly amounts of cross-border purchases increased from 20,000 RMB (2560 EUR) to 26,000 RMB (3333 EUR)
According to the existing CBEC policy, on the condition that a single transaction value is under RMB 5,000, and the annual transaction value is within RMB 26,000, the import tariff rate is fixed at 0%, and at the same time, the import VAT and consumption tax enjoys 70% of the tax payable.
Therefore, the CBEC tax rate is calculated as below:
CBEC Comprehensive Tax Rate = [(VAT rate + Consumption tax rate) ÷ (1 – Consumption tax rate)] × 70%
Starting from April 1st 2019, China’s VAT rate was updated as follows:
Manufacturing sector (including imported goods): dropped from 16% to 13%
Construction and transport: dropped from 10% to 9%
Services: remained at 6%
This reduction of VAT tax will significantly impact the tax rate of CBEC:
For most products (with 0% consumption tax), the CBEC integrated tax is lowered from 11.2% to 9.1%
For high-end cosmetics, CBEC integrated tax rate is lowered from 25.53% to 23.05%
*High-end cosmetics refers to products with an after-tax wholesale import price above 10 RMB/ml(g) or 15 RMB/piece.
Here is a list of CBEC integrated tax rate for each product category (in Chinese).
In practice, this reform opens the cross-border market for a lot of luxury retailers with products in the 2,000 to 5,000 RMB range. For industries such as high-end fashion and cosmetics which strongly appeal to Chinese cross-border buyers, this is a game-changing move.
But on the condition that a single transaction exceeds RMB 5,000 or/and the annual transaction value beyond RMB 26,000, the products imported via CBEC should be subject to the same rates of the taxes under general trade mode, i.e. cannot enjoy the 0% import tariff, and no more 70% VAT and consumption tax rate.
our B2C Direct Shipping Advantage
provide with you more competitive shipping cost
Full Tracking including from Hong Kong to China of end to end
Assist you to complete all the filing procedures with China Customs.
Our TMS system can be API integration with all customer's system to realize fully automated operation and information exchange
Easy Payment Methods
You can make use the easy convenient payment options, listed below, that are available in your country.
Fast and efficient
We enhance our logistics operations by relieving you of the worries associated with freight forwarding
How Can We Help?
- Contact Us Today
AFL Logistics Limited
Room C5, 11/F Wing Hing Industrial Building,
14 Hing Yip Street, Kwun Tong, Kowloon, Hong Kong
Tel : +852 31535365
Fax: +852 31535389