General Administration of Customs Shanghai Classification Center researches e-cigarette companies

  On the morning of April 26, 2018, a "Tariff Research Enterprise Presentation" was held at the Shenzhen Customs, with Xu Xiurong, the head of the Tariff Research Section of the Shanghai Classification Center of the General Administration of Customs, as the speaker. Representatives from dozens of companies attended the presentation, including Shenzhen Airlines, Walmart, BYD, Huawei, ZTE, Skyworth, Konka, Samsung, DuPont, and others. Ao Weinuo and Shan Jing from the Electronic Cigarette Industry Committee Secretariat participated in the presentation as representatives of the electronic cigarette industry.

    With the continuous development and progress of technology, some new products face issues regarding tariff classification and customs codes when exported. Director Xu provided targeted analysis and explanations, and the engaging presentation received rounds of applause, benefiting the attending company representatives greatly. The customs department accepted numerous inquiries from companies regarding import and export operations. As the regulatory body for imports and exports, the customs department's spirit of service in alleviating enterprises' concerns was highly recognized by the companies!

    At the invitation of the Electronic Cigarette Industry Committee Secretariat, in the afternoon of the same day, Deputy Researcher Cai Lizhu from the Shenzhen Customs Tariff Department, Director Wu Yilv from the Tariff Classification Section, and Director Xu Xiurong and Deputy Director Song Zhihua from the Shanghai Classification Center of the General Administration of Customs visited Hengxin Group for research and investigation.

    The Executive Vice President of the committee, Chairman Yao Jide of Hengxin Group, warmly welcomed Director Xu and his team, introducing the development history of electronic cigarettes. As a newly emerging industry invented and produced by Chinese people, electronic cigarettes have captured over 90% of the global market, generating tax revenue for the country and firmly grasping market initiative and discourse power. This is a proud achievement of Chinese innovation, and the government should provide support and recognition in policy.

  Director Xu and his team expressed their affirmation of the development and achievements of electronic cigarettes. As a new industry, the customs department will respond to national policies, conduct in-depth research in enterprises, listen to reasonable demands from companies, and provide reasonable suggestions for national tariff formulation.

  Finally, Secretary Ao Weinuo introduced the work carried out by the Electronic Cigarette Industry Committee since its establishment and reiterated the request to the customs department. The industry believes that e-liquid should fall under the tobacco substitute tariff code 2403.9900, while the customs announcement classifies e-liquid under item 38.24, and it is often classified under item 21.06 when imported into other countries.

    Currently, the export tax rebate rate for e-liquid under tariff code 3824.9999 is only 5%, leading to increased costs for companies, which have to raise export prices, adversely affecting product export revenue and industry development. To consolidate the domestic e-liquid industry's position in the world and enhance export revenue, it is suggested to add sub-item 3824.9996 for e-liquid and set the export tax rebate rate at 15%. It is also requested that the customs department provide policy support for China's electronic cigarette industry, and the Electronic Cigarette Industry Committee Secretariat will continue to follow up on the progress of this application.