FMC to probe impact of China VAT

   The U.S. Federal Maritime Commission discussed the implications of China’s new value added tax regulations on international transportation services during a closed door session Wednesday.
   The new tax was implemented by China on Aug. 1, with a number of maritime industry stakeholders expressing concerns about how the application of the VAT could affect their businesses.
   “The commission has now received requests for assistance from the shipping community to clarify the application and scope of the VAT,” the FMC said in a statement Thursday. “At this time, commission staff is gathering information on the VAT by cooperating with other U.S. federal agencies, our U.S. Embassy and various U.S. consulates in China. In addition, staff is gathering information from the private sector including carriers and non-vessel-operating common carriers (NVOCCs).”
   The FMC said it is concerned the VAT could create negative impacts on ocean commerce between the United States and China.
   “Ocean carriers and NVOCCs regulated by the commission appear to be collecting the new tax,” the statement said. “In light of (Wednesday’s) discussion, the commission is considering a range of options to obtain further clarity on the application of this new tax regime.”
   American Shipper reported in mid-August that shipper groups were concerned about the impact of the new VAT.