January 10, 2008

China waives tax for HK, Taiwan-bound grains

China recently announced that grains shipped to Hong Kong, Taiwan and Macau will be free of export tax, the China Securities Journal reported.

Mainland China previously imposed export taxes on grains between 5 to 25 percent, through out 2008 to stabilize the prices in the country.

Rising grains, flour, meat and food prices have driven inflation to an 11-year high in November 2007.

China ruled that Hong Kong and Macau are under the "one country, two systems" policy, while Taiwan was considered as a renegade province. It includes trade with all three when reporting its international trade statistics.

Hong Kong and Macau heavily rely on the mainland for their food supply, while Taiwan occasionally imports Chinese grains.