On October 24, 2023, the Sichuan Provincial Taxation Bureau announced that in the first three quarters of 2024, the region’s tax authorities have processed over 19.2 billion yuan in export tax refunds and exemptions, representing a year-on-year increase of 6.06%. This includes 11.95 billion yuan in export tax refunds specifically for businesses.
In recent years, a significant number of “Sichuan brands” have seized opportunities in international markets. Data shows that in the first eight months of 2024, Sichuan’s import and export volume with countries participating in the Belt and Road Initiative grew by 16.9%, accounting for 44% of total trade.
To support companies venturing abroad in tackling complex tax issues related to cross-border operations, the Sichuan tax authority has implemented a cross-border tax service initiative called “Tax Road Connect: Embracing Diversity.” They have also formed a provincial-level language team dedicated to creating investment tax guides, gathering overseas tax information, and researching international tax reforms to assist these companies in acquiring relevant tax data from host countries and staying updated on global tax reform trends.
The first three quarters of 2024 saw an increase of 11.7% in the number of foreign trade enterprises conducting import and export activities in Sichuan. Among these, foreign trade and manufacturing companies significantly contributed to export volumes, making up 47% and 45% of the trade entities respectively. “In the first three quarters of 2024, our company had an export value of 44.32 million yuan and benefited from a tax refund of 4.712 million yuan. The export tax rebates and special deductions for R&D expenses have accelerated our cash flow, allowing new projects to be completed smoothly and expected to generate annual sales of approximately 350 million yuan, creating over 300 jobs,” said Gong Deqiong, the finance manager of Sichuan Haobais Baby Products Co., Ltd.
Throughout the process of bolstering foreign trade enterprises, the Sichuan taxation department has leveraged online and offline strategies, including interactive platforms and one-on-one counseling, to provide policy guidance, address business inquiries, operational instructions, and reminders regarding tax refunds, to ensure timely and efficient tax relief. “We will further optimize the business environment for foreign trade and streamline the export tax refund process,” stated a representative from the Goods and Services Tax Division of the Sichuan Provincial Taxation Bureau.
Examining the main products eligible for export tax refunds from Sichuan in the first three quarters of 2024, industrial manufactured goods represented a substantial share of foreign trade exports. Notably, the export tax refunds for motors and electrical equipment accounted for 42.5%, while machinery and vehicles and their parts made up 16.9% and 7.6%, respectively. Many Sichuan-made products are leading the nation in export volumes. For instance, lithium nickel cobalt manganese oxide and fish oil exports ranked first in the country, each accounting for over 30% of national exports, while titanium dioxide, land oil drilling rigs, lemons, and caviar ranked second nationwide. “Our annual caviar production exceeds 60 tons, holding 12% of the global market share,” said Li Jun, head of Sichuan Sturgeon Industry Co., Ltd., noting that the company has benefited from over 8.5 million yuan in R&D tax deductions and more than 8 million yuan in export tax refunds in recent years.
According to Liu Rong, a professor at the School of Finance and Taxation at Southwest University of Finance and Economics, the export tax refund data from Sichuan in the first three quarters of 2024 reflects the region’s robust export activity and highlights the strong momentum of foreign trade. Moving forward, Sichuan needs to maintain its growth in foreign trade, relying on improved global trade conditions and actively leveraging the roles of tax and customs authorities in optimizing the international business environment.
