CNC machine tool carbide tool export tax rebate standard increased to 11%

Abstract Recently, the State Council approved a notice issued by the Ministry of Finance and the State Administration of Taxation, titled "Notice on Raising the Tax Rebate Rate for Some Commodities." This policy aims to boost the export competitiveness of Chinese enterprises by increasing tax rebate rates for certain labor-intensive, high-tech, and high-value-added products. Among the items affected is a specific product in the machine tool industry: carbide tools used in CNC machines. These tools, classified under HS code 8208101000, are now eligible for an 11% tax rebate, reflecting the government's focus on supporting advanced manufacturing and export growth. Industry experts note that this adjustment aligns with long-term efforts to promote the production of more advanced cutting tools. By offering higher rebates, the state is not only encouraging domestic demand but also helping enterprises enhance their global market position. This move is expected to contribute positively to the country’s economic stability and growth. It should be noted that while high-speed steel cutting tools remain widely produced due to their lower cost and existing demand, they are resource-intensive and often associated with lower profit margins. As a result, the industry has been gradually shifting toward more advanced materials like carbide. However, despite these trends, many Chinese tool manufacturers still rely heavily on high-speed steel tools, especially given the needs of China’s expanding machinery sector. In 2012, China’s total tool exports reached $800 million, with the majority consisting of high-speed steel tools. Carbide tools accounted for only a small fraction, valued at tens of millions of yuan. The export structure of these products has also led to trade disputes, particularly with developed nations such as the U.S. and Germany, and even boycotts in some regions like Spain and South America. In response, the tool industry has called for reduced exports of high-speed steel tools, though the industry’s transition remains slow. This policy change signals a broader effort to modernize China’s tool industry and align it with global standards, promoting sustainable development and international trade harmony.