China to cut import tax on infant formula in 2014  

部分嬰幼兒奶粉進口暫定稅率明年下調

(ECNS) -- China will reduce the import tax on retail infant formula as well as a special type of formula, by 67 percent and 75 percent, the Beijing News reported.

The government will temporarily reduce tariffs on more than 760 items -- putting them below most-favored-nation tariffs, representing an average tax discount of around 60 percent, the Customs and Tariff Commission of State Council said in a statement Monday.

The tax on imported infant formula with retail packaging will be reduced from 15 percent to 5 percent, while the tax on hypoallergenic infant formula, including hydrolyzed formula and amino acid formula, will drop from 20 percent to 5 percent.

Zhao Ping, director of a research institute under the Ministry of Commerce, said domestic demand of imported goods is increasing, and thanks to improved living standards, infant formula is now defined as a middle class necessity, not a luxury item.

Hypoallergenic infant formula may help lower the long-term risk of allergies in children who are genetically vulnerable to them, according to foreign studies.

Other beneficiaries of the tax cut are manufacturers of equipment, spare parts and raw materials used in "emerging" sectors making strategically important items such as aircraft, mobile phones and tablet computers.