News
In response to confusion over the scope and application of a new business value-added tax (VAT) enacted by China, the U.S.'s National Industrial Transportation League (NITL) has recently requested assistance from the government in obtaining clarifications on the VAT from the Chinese government.
In letters written to the U.S. Department of State, Federal Maritime Commission and Department of Transportation's Maritime Administration NITL President and CEO Bruce Carlton said the new Chinese tax which came into effect on August 1, 2013 has created much confusion as to its application and resulting impacts especially on freight moving between the two countries.
According to China, the six percent VAT is applicable to domestic shipping, logistics and freight forwarding in China and not specifically to international ocean freight, the NITL CEO noted. ''Nevertheless we have monitored reports that some ocean carriers and non-vessel operating common carriers (NVOCCs) are simply passing on the tax to their customers in the form of surcharges or service charges even when the freight charges have been, 'pre- paid,''' he added.
The NITL is the nation's oldest and largest freight transportation association whose membership includes transportation decision makers, suppliers, and intermediaries.
