A consumption tax is levied and there is something to be said in the paint industry

China Coatings Network
News: January 26, the Ministry of Finance, the State Administration of Taxation , "on the battery,
coatings
consumption tax notice" proposed that from February 1 for the construction of volatile organic matter (VOCs) content of more than 420g / L of paint consumption tax. As of the policy, there was a strong reaction in the paint industry. China Chemical News reporter learned that
paint enterprises
generally believe that the New Deal is the embodiment of the implementation of green taxation, but the relevant provisions are difficult to cut the key, the actual implementation may backfire, it is difficult to achieve the original intention of promoting the green transformation of the industry. At the same time, the 4% tax rate will put more pressure on an already low-margin industry and affect the future state of business. As the relevant departments have not yet issued the implementation rules, most enterprises on how to deal with the paint consumption tax seems at a lack of ability.
the original intention of reducing emissions can be achieved
In the past two years, smog has been frequent in most parts of the country, which has caused the state to attach great importance to air pollution control, and VOCs are an important factor in the formation of composite air pollution. Since surface coating VOCs account for 21.6% of industrial sources and 12% of man-made sources, paint VOCs emissions have become the top priority of national air pollution control. In September 2013, the State Council issued the Action Plan for the Prevention and Control of Air Pollution, which calls on all regions to promote VOCs, carry out comprehensive management in key industries such as surface coating, and promote innovation in non-organic solvent coating products.
, according to the China Paint Industry Association, the Ministry of Environmental Protection has been implementing environmental economic policies for several years, green tax is an important part of it. The National Development and Reform Commission (NDRC) clearly stipulates in the Industry Adjustment Guidance Directory that "restrictions on the production of solvent-based coatings" are clearly defined, and the Department of Political and Legal Affairs of the Ministry of Environmental Protection has proposed to the Tax Administration department of the Ministry of Finance and the State Administration of Taxation that a consumption tax on solvent-based coatings be levied. Therefore, the introduction of the consumption tax policy on January 26th is undoubtedly a major blow to the country's efforts to promote the green transformation of paint products and promote the reduction of VOCs emissions.
, president of the China Paint Industry Association, told China Chemical News: "This is the first time that China's consumption tax policy has introduced indicator conditions. China's economic development has entered the new normal, the consumption tax policy on paint is the country's industrial development and transformation, environmental protection policy pressure in the paint industry the most rapid embodiment, to promote the transformation and upgrading of the industry has become an inevitable trend. The state will further encourage the paint industry to transition to an environment-friendly direction. "
, but can such an original intention be achieved?" In this "tangible hand", the paint industry can eliminate high VOCs products, green upgrade? Reporters learned that this is not the case. Many enterprises have reflected that the impact of the consumption tax is a number of compliance operations of large-scale enterprises, the production of paint products are also in line with national standards. And some unqualified small workshop-style factories, has been free from the regulatory line of sight, there is already tax evasion, at the same time, there is the possibility of illegal means to sell high VOCs paint, to avoid consumption tax. Enterprises have expressed the hope that there is a fair platform, as well as simple detection methods, to avoid the phenomenon of "bad currency to good money", but also hope that the country can introduce incentives for advanced, punishment backward policies.
Yuande, secretary-general of the China Coatings Industry Association, also believes that because of the dispersion of the paint industry, the irregularity of production and the lack of supervision, the controllability of taxation is not strong, the control is extremely difficult. The result of implementing the New Deal can only be to tax a small number of regulated enterprises of a certain size, and a large number of irregular enterprises are difficult to collect. Because tax or not directly leads to a larger cost difference, the competitiveness of regulated enterprises will decline, can only selectively exit part of the market, enough to give way to those who do not pay taxes and have a cost advantage of enterprises, the result may block or delay the process of industry integration, so that some smaller, high-polluting enterprises to obtain greater living space than before, the industry is likely to fall into chaos.
4 per cent tax rate is a big drink for micro-profits. In accordance with the provisions, the tax department will be based on the paint production enterprises factory sales of 4% of the consumption tax, after confirming that the product VOCs are suitable for the scope of collection, sales are based on the enterprise issued a non-tax sales invoice. Li Rongjun, chief engineer of Haihong Old Man Coatings (China) Co., Ltd., said: "China's paint industry already has a lot of standard limits on harmful substance emissions. Is it the implementation of national standards, or is it the implementation of the standards of the General Administration of Taxation? This involves the issue of detection. The 4% tax rate is not low, and companies have to increase the cost of testing. Paying this tax would cost millions of dollars a year more. It is not a particular paint factory that
damage, but
the entire coating industry. Fang Qi, deputy general manager of China Resources Coatings Group, also said that some coating quality to meet national standards, such as film hardness indicators, may exceed the 420g/L VOCs limit, enterprises dilemma. Another business leader said, "Many contracts were signed a year or six months ago, the original industry is a small profit, net profit in 5% to 10%, now take 4%, the survival of the enterprise is too difficult." The battery industry can start in 2016 and we're going to start with the release period, it's
!" In addition, the field of coatings and coatings is implementing the greening process, invested a lot of money in equipment transformation, and now to be taxed, there is also unfair. Du Weina, deputy director of the Shanghai paint factory, said: "Is it enough to cut emissions by collecting 4% consumption tax, or is it really controlling VOCs emissions?" In fact, coatings are already green in many applications. For example, many coil production lines have invested a large number of solvent recovery devices, the coating process will not cause VOCs pollution of the atmosphere. Some products and downstream users have fulfilled their promise of green development and should embody the principle of equity in the implementation of the consumption tax.
even more insoptive is that the consumption tax is levied at price, and in general, the higher the price of high-end paint products, the more consumption tax to be levied, obviously not conducive to encouraging advanced. And some less harmful volatile organics, such as ethanol and acetone, are exempt from taxes in developed countries, but this time the policy is not clear. Yang Yuande believes that from the introduction of policies, toxicity does not affect the amount of collection, ethanol and benzene in the face of the consumption tax is equal. Moreover, the correlation between haze and taxation is not reflected.
How to deal with suddenly
Sun Lianying said, now that the consumption tax policy has been introduced, the paint industry can only do a positive response, sustainable development of low VOCs environmentally friendly coatings and high value-added products, in order to promote structural adjustment, guide the industry healthy and sustainable development. However, the policy was introduced faster than the industry had expected. Reporters learned that in the second half of 2013, the Ministry of Environmental Protection, the Ministry of Finance, the General Administration of Taxation jointly held the first meeting on paint consumption tax, proposed to levy solvent-based paint consumption tax at the end of 2104, for construction thinning, commissioned processing, curing agents, starting point and other issues, repeatedly discussed and modified many times, delayed to February 1, 2015, but for the industry is still too hasty.
The scope of the levy is defined as grease, natural resins, phenolic resins, asphalt, alicyl resins, amino resins, nitrates, filtered ethylene resins, oleic resins, acrylic resins, polyester resins, epoxy resins, polyurethane resins, elemental organics, rubber (13540, 400.00, 3.04%) class, cellulose class, other film-forming class, etc. Individual resins, curing agents, thin materials are not levied, the auxiliary
coating definition of
not levied. According to the past practice of similar policies introduced by the state, in order to make supporting measures in place or gradually improve the implementation of the rules, will choose part of the pilot, or set a buffer period. The imposition of a consumption tax on paints, which took only a few days from its announcement to its formal implementation, and the absence of specific implementation rules, has caught most businesses off guard. At present, the implementation process is also more chaotic.
420 g/L is based on the 1990 U.S. Clean Air Act (CAA) and its amendments that limit VOCs (after thinning) coatings to 420 g/L (excluding water). According to china Paint Industry Association experts, the object of this levy is mainly paint production enterprises, commissioned processing also belongs to the production enterprises, the paint circulation and construction links do not levy consumption tax, foreign paint production enterprises with brands imported into China to collect consumption tax. Yang Yuande said that there are a few points that need to be further clear: First, only the processing fee of commissioned processing and OEM form of processing how to distinguish; Second, after domestic production, large barrels to small barrels of sub-packing enterprises whether to levy; Whether the trademark change and the non-trademark are treated differently when they are divided; Third, there are already tariffs on imports, whether the consumption tax is levied repeatedly. So to determine the object of collection, the paint industry will change dramatically: sales will flow in large quantities to the circulation link.
because companies will file consumption tax in early March, some local tax authorities have begun to communicate with companies about tax matters. However, according to enterprises, tax officials do not know much about paint, because the policy does not have supporting implementation rules, and paint varieties have thousands, the formula is very complex, it is not possible to too many tangles in detail, everything in accordance with the policy. For the 17 categories of products mentioned in the policy, companies are required to provide testing reports to see if VOCs are below 420g/L, and some areas may even take a first-pay-back approach if they do not report or pay higher taxes. Part of the enterprises involved in import and export trade reflect that, on February 1, the General Administration of Customs updated the coding table, will be higher than 420g/L paint set a new code, but at present enterprises are in accordance with their own understanding of the product classification, according to the new coding customs clearance, but in the future if the country issued a unified classification method, and the classification of enterprises will bring a lot of trouble. In addition, when imported paint products are customs clearance, curing agents and thinners are also taxed, increasing the cost of imports.
" construction methods are different, southeast and northwest temperature and humidity are different. Therefore, the construction status of the coating and the VOCs in the tank is difficult to draw the equal sign, the tank is relatively good supervision, but there is no effective supervision measures under the construction state. Although the state can establish standards and supporting regulations, the paint production enterprises must be labeled on the packaging paint VOCs content and construction dilution ratio, as one of the basis for tax inspection, but it will take time. Yang Yuande pointed out.
addition, the notice of "other film-forming categories" also did not have a clear statement, the enterprise itself determined that greater than 420g/L is not need to report the test? There is no regulation on whether the consumption tax should be paid annually or monthly. Many enterprises believe that the rules did not come out, it is difficult to implement, hope that the state can give a buffer period, until all the details of the content is clear, and then let enterprises pay consumption tax. There are also suggestions in the industry, can refer to foreign practices, the supervision of consumption tax from the designated institutions to the enterprise's own declaration, marked on the paint packaging. If not identified, or false identity is punished. To reduce the cost of compliant enterprises and increase the cost of unconventional enterprises can the industry form a virtuous circle.