Customs Reduction Will be a Turning Point for China Cross Border eCommerce

TMO GroupMay 6, 2015
Customs Reduction Will be a Turning Point for China Cross Border eCommerce

In China, the adjustment of customs for import products already given policy bonus. However, there will be much more development space in cross border eCommerce.

Recently, Li Keqiang, the premier of the State Council of China said that China will reduce customs for some kinds of commodities which have higher requirement at the end of June. At the same time, combined with customs reform, consumer products such as cloths and cosmetics will also adjust the taxation scope. In addition, more imported duty-free shops will be set up.

Currently many Chinese consumers purchase oversea goods through foreign eCommerce websites or personal Haitao service in order to reduce customs. It causes a massive outflow of domestic consumption. As a result, the new policy which aim to reduce tax would prevent it. And more consumers will come back to formal shopping channels. A statistic shows that the total amount of the transaction reached 3 billion in first half last year. And there are more than 5000 cross border eCommerce platforms and more than 200 thousand enterprises. It is expected that there will be 35 million cross border consumers by the end of 2018.

In a certain extent, the price difference is the only motivation of cross border eCommerce. As long as losing this advantage, it will cause a big challenge for it, especially for small scale companies. Import cross border eCommerce are currently classified into several categories of trading houses, entitled to different levels of benefits such as simpler customs clearance depending on their revenue.In addition, in order to deal with the problem of cross-border commodity distribution, cross border owners have changed their lighter assets to heavy assets and started to build the overseas warehouse.

To be honest, the cross border eCommerce market is still in the exploration stage. It is not clear for which kind of business model can exactly attract consumers. And some people think that some product price even lower than domestic one. And fake products and transaction security problem still exist.

In terms of the rights of consumers, many cross border products or platforms don't support no reason return in 7 days. Consumers have to contact sellers themselves if there are quality problems. So some relevant laws must be setup up in order to prevent consumers rights from being aggrieved.

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