China's e-commerce tax changes set to benefit beauty
According to a recent report by Bloomberg Business, a year-long trial of a lower tax rate for goods sold online in the Chinese city of Hangzhou has seen success, and the country’s State Council has broadened it to now encompass 12 more cities.
According to Xinhua News Agency’s ‘Economic Information Daily’, the government is likely to adjust taxes again this April, with high-end products like cosmetics and electronics tipped to become cheaper as a result.
“Discounted value-added and consumption taxes are expected to be expanded nationwide and replace a special tax for bonded imports, according to the report,” Bloomberg says.
Korean beauty in China
Facilitating the cross-border trade of cosmetics will no doubt further fuel the strong Chinese appetite for Korean beauty.
According to the Korean International Trade Association, Korean companies accounted for 22.1% of China's imported cosmetics last year, closing the gap with French rivals, whose combined market share was 30.6%.
The Trade Association reports that in the first seven months of the year, China's imports of foreign cosmetics products rose 36.1% to $1.67 billion - in large part thanks to cross-border retail.
China and Korea: border hopping
In a key recent example of the growing enthusiasm among Chinese consumers for Korean beauty, China’s largest online retailer, JD.com signed a five year deal with South Korea’s ‘leading online shopping site’ Lotte.com last October.
JD.com shoppers are now able to purchase Korean products from cosmetics to fashion from Lotte through the company’s cross-border platform.
“The demand for products through Korean Mall has been strong and partnering with Lotte, Korea’s clear industry leader, will help us meet the growing needs of our users,” JD Mall CEO, Haoyu Shen, said of the deal.
The predicted changes in China’s e-commerce tax policy will further benefit this growing market.
