Controlling cross-border e-commerce will not help expand domestic demand

CHINA IS RAISING the tax on retail goods imported by e-commerce organizations by a large margin from Apr 8. Beijing News commented on Thursday:

The cross-border e-commerce industry has boomed because of favorable tax rates since 2014. Some small e-commerce enterprises will probably disappear because of the higher tax rate.

Four reasons are apparently behind the new tax: large amounts of e-commerce import goods increase the customs' supervision costs; the low tax reduces the government's tax revenue; the fast expansion of cross-border e-commerce has had a negative influence on the development of the domestic consumer market; the low tax is unfair to other importers.