China Postpones Cross-Border Sales Tax over Fears of e-Commerce Slowdown

China's tax authorities rolled back on their new cross-border sales tax program to avoid a pile of problems
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China's tax authorities have rolled back on their new cross-border sales tax program in an attempt to avoid a pile of problems. 

If implemented, the new rules would have meant tighter customs treatment and higher tax rates on overseas goods sold on Chinese e-commerce sites, which previously allowed shoppers to buy imported goods via cross-border e-commerce zones on a special parcel tax rate.

However, when China imposed the stricter tax system last month, social media was filled with pictures of heaps of abandoned foreign purchases at Shanghai Pudong Airport as travelers attempted to avoid the tax fines.

Shanghai customs later said that the posts were falsified rumors "spread by e-commerce companies and consumer-to-consumer (C2C) e-retailers" in order to pressure policymakers, China's official Global Times reported. However, it looks like the pressure might have worked. 

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