Thu, Nov 02, 2006 - Page 12 News List

China levies 30 percent tax on bananas

STAFF WRITER WITH CNA , SHANGHAI

Apart from delays in travel time and difficulties in getting payment from Chinese businessmen, Taiwan exporters also face import duties as high as 30 percent on shipments of bananas to China, a fruit distributor said yesterday.

Peng Sheng-fu (彭勝夫), deputy manager of the Taiwan Provincial Fruit Distribution and Co-op Association, said Taiwanese banana exports to China are levied with a 30 percent duty -- 13 percent in customs duty and 17 percent value-added tax.

Beijing allows 22 types of Taiwanese fruit to enter the Chinese market and began granting duty-free treatment in August last year to 15 of them, not including bananas -- one of Taiwan's major crops.

The high duty has markedly eroded the fruit's competitiveness in the Chinese market, Peng said. He also insisted that Taiwanese fruit sellers should set their sights on the luxury market in China.

Many Taiwanese companies also have complained of volatile business risks in China, as Chinese importers usually do not issue letters of credit to guarantee the payment of goods they purchase, Peng said.

In addition, shipments from Taiwan are required to go through a third country, delaying travel time and increasing production costs.

According to Shanghai fruit sellers, a kilogram of Taiwanese bananas sells for around NT$18 (US$0.55) -- double the price of those shipped from China's Hainan Island.

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