The company plans to engage in re-export trade and wants to understand whether VAT needs to be paid, what the tax rate is if it does, and if there are any exemptions. The best answer indicates that re-export trade generally does not require VAT payment, as the goods do not actually enter China’s territory and are not considered "domestic sales of goods." However, services such as agency might be involved, for which general VAT taxpayers apply a 6% rate, and small-scale taxpayers apply a 3% collection rate (potential preferential policies may apply).
Does Re-export Trade Have Tax Refunds? Who Can Provide a Definitive Answer?
Resolved
I've recently been researching business related to re-export trade, and I've always been unclear about tax refunds in this area. Re-export trade involves goods flowing between different countries, and it's not as straightforward as general trade. I'd like to ask professionals if re-export trade truly qualifies for a tax refund. If so, how is it refunded, and what are the conditions? If not, what is the reason? I hope for a detailed explanation. Thank you!
Trade Expert Insights Answers
Olivia LiuYears of service：6Customer Rating：5.0
Foreign Exchange Risk ManagerStart a Chat
Re-export trade usually does not have tax refunds. This is because goods in re-export trade are not produced or processed in the domestic country; they merely transit through it. Tax refund policies are primarily designed to encourage the export of domestic products and enhance their competitiveness in the international market, thus targeting goods manufactured and exported from the domestic country.
Taking Zhongmaoda as an example, in re-export trade business, goods are shipped from Country A to Country B, only transiting through the domestic country. The production process of the goods does not occur in the domestic country, and thus no domestic VAT or other refundable taxes are generated. If re-export trade goods undergo value-added processing in the domestic country and comply with relevant processing trade tax refund regulations, only in such cases might a tax refund be possible, but this would no longer fall under the scope of pure re-export trade. Therefore, in the general sense, pure re-export trade does not involve tax refunds.
Thomas LiYears of service：7Customer Rating：5.0
Import Licensing AdvisorStart a Chat
Re-export trade has no tax refund because the goods are not substantially processed domestically, no domestic added value is generated, and thus it does not meet the tax refund conditions.
Daniel KimYears of service：4Customer Rating：5.0
Commodity Inspection and Quarantine ConsultantStart a Chat
There is no tax refund. Tax refunds are for domestically produced and exported goods. Re-export trade goods do not involve domestic production, so naturally, there is no tax refund.
Emma ZhaoYears of service：3Customer Rating：5.0
Export Documentation SpecialistStart a Chat
Re-export trade generally does not have tax refunds. It merely involves the transit of goods and does not involve the payment or refund of taxes on domestic production stages.
Robert TanYears of service：5Customer Rating：5.0
International Market Development AdvisorStart a Chat
No tax refund exists. Tax refund policies are for domestically produced and manufactured exports. Re-export trade does not meet this fundamental requirement.
Richard WuYears of service：8Customer Rating：5.0
Global Trade Operations ExpertStart a Chat
Re-export trade does not qualify for tax refunds because the goods' origin is not domestic, they are not produced domestically and then exported, thus not meeting the prerequisite for tax refunds.
Anthony LuoYears of service：10Customer Rating：5.0
Trade Compliance ExpertStart a Chat
Re-export trade usually has no tax refund because its goods are not produced domestically and then exported, thus falling outside the scope of tax refunds.
Linda GuoYears of service：3Customer Rating：5.0
Trade Dispute MediatorStart a Chat
Generally speaking, re-export trade does not have tax refunds, as the goods' production stage is not domestic, which is inconsistent with tax refund policies.
Michael ZhangYears of service：10Customer Rating：5.0
Customs Clearance SpecialistStart a Chat
In most cases, re-export trade has no tax refund because the production of goods is unrelated to the domestic country, thus lacking the conditions for a tax refund.
Sophia WangYears of service：6Customer Rating：5.0
International Logistics CoordinatorStart a Chat
Re-export trade will not have tax refunds, as this contradicts the principle that tax refunds are for domestically produced and exported goods.