At the two sessions in 2018, the 13th National People's Congress representative and Tian Tianren, party secretary and chairman of the Tianneng Group, once again proposed a proposal for lead battery excise duties, hoping to optimize the adjustment of the taxation of lead battery excise duties. According to the Battery China Network, this is the representative of Zhang Tianren’s speech on the adjustment of lead battery excise duties at the two sessions for three consecutive years. Since the official implementation on January 1, 2016, the lead-acid battery excise tax has caused lead-acid battery manufacturers to suffer, and industry insiders have been rushing to appeal for it. Lead-acid battery consumption tax will be adjusted or even canceled?
Lead Storage Battery Consumption Tax
In January 2015, the Ministry of Finance and the State Administration of Taxation issued the “Circular on the Collection of Consumption Taxes on Batteries and Coatings†(hereinafter referred to as the “Noticeâ€). The “Notice†included batteries and paints in the scope of excise tax collection, and was used in production and commissioned processing. As for the importation and importation, the applicable tax rate is 4%.
The "Notice" proposed that consumption tax be exempted for mercury-free primary batteries, nickel-metal hydride batteries, lithium primary batteries, lithium-ion batteries, solar cells, fuel cells, and all-vanadium redox batteries. From January 1, 2016, consumption tax will be levied on lead batteries at a rate of 4%.
As early as in the Third Plenary Session of the 18th CPC National Congress held in 2013, the state has clearly stated that it is necessary to “enlarge the scope of taxation and include high pollution, high energy consumption, high-end consumer goods, and luxury goods into the scope of excise tax collection.†The battery, as the "highly polluting" product in most people's eyes, is also included in the scope of the excise tax.
In the industry, the original intention of the country's introduction of the lead-acid battery excise tax is agreed, but the industry generally believes that the lead-acid battery is not a highly polluting product. It seems unreasonable to levy a battery consumption tax in the name of promoting environmental protection.
　　
Re-examining lead storage battery consumption tax
Bring lead-acid batteries, the words “heavy metal,†“acid,†“corrosion,†and “pollution to the environment†are often found in people’s minds. Although there are heavy metals and electrolyte components in lead batteries, this does not mean that the lead batteries themselves are contaminated products.
In fact, compared to the production process, the real pollution risk of lead batteries exists in the recovery and smelting process. This is an area that the government needs to focus on. For many years, the recycling market of used lead-acid batteries was dominated by small traders and there was a lack of effective supervision. A large number of waste lead-acid batteries were dismantled and disposed at random, causing pollution of the atmosphere, soil and water sources. However, levying consumption tax on production, in addition to increasing the tax burden on lead battery manufacturers, has little effect on curbing illegal dismantling.
Lead-acid battery excise duties have been implemented for more than two years. Overall, the collection and management is basically in place, but lead-acid battery companies are burdened with heavy cost pressures. Industry agencies conducted surveys and statistics on 52 large and medium-sized lead battery companies. The results showed that in 2016, a total of 2.32 billion yuan in consumption tax was paid, while the total profit for the same period was only 1.93 billion yuan.
As a leading lead battery manufacturing enterprise in China, relevant responsible person of Chaowei Group stated that the concentration of lead battery industry is not high, which has led to a serious “price war†in the lead battery industry in recent years, and the overall profit of the industry is low. Formal enterprises have invested a great deal of cost in cooperating with environmental protection access work, and have also depressed the profit margin of lead battery products. In addition, after the consumption tax is collected, some illegal enterprises often reduce taxation costs by means of tax evasion and the like, which also weakens the price competitiveness of the regular enterprise battery products, and the tendency of “bad money drives out good money†has intensified.
The industry believes that the purpose of levying a lead-acid battery excise tax is to protect the environment. For some battery companies that already meet the industry's regulatory requirements and achieve cleaner production, it is not appropriate to continue to implement the excise tax levy. Therefore, such companies should be exempted from exemption. Or differentially levied consumption tax.
In addition, there are views that if you want to limit the consumption of lead-acid batteries, you should tax them on the consumer side rather than on the production side. However, if the taxation cost is passed on to consumers through price increases, it will not only be detrimental to the development of formal lead storage battery companies, but it will also give informal enterprises opportunities to further reduce industry concentration, which will seriously affect the sustainability of the industry. development of.
Lead-acid battery excise tax has become a "heart disease" for lead-acid battery manufacturers. This "disease" does not go in one day, and companies are unhappy on the 1st.
Lead-acid battery excise tax is hard to shake
The original intention of the state to implement the lead-acid battery excise tax is to promote energy-saving emission reduction and environmental governance. In recent years, the state's environmental protection investigation and control efforts have been increasing, and there is no sign of "relaxing" the lead-acid battery excise tax.
Over the years, lithium batteries have eroded the market share of lead batteries. In 2017, the output of new energy vehicles exceeded 800,000 vehicles, more than 300,000 vehicles in 2016, an increase of 60% year-on-year. According to statistics from the Power Battery Application Branch of the China Chemical and Physical Power Industry Association, the installed capacity of new-energy automotive power batteries in China in 2017 was 36.4 GWh, and the market scale of lithium batteries expanded step by step. In addition, the low-speed electric vehicle power battery also has the tendency to change to the lithium battery, the promotion work of the hydrogen fuel cell is also in full swing, this is not a good thing for the lead storage battery.
The efforts made by the industry to cancel or adjust the lead-acid battery excise tax will not be effective in a short time. It may be more realistic to seriously think about how to cope with the increased cost pressure of the excise tax.
According to the relevant person in charge of the Chaowei Group, only the hard work of “internal work†and reducing costs can enhance the profitability of the company.
According to the Battery China Network, as a lead battery giant, Chaowei Group has improved its soft power by improving its management methods, increasing talent cultivation, and opening up innovative environments. Through technology innovation, it has reduced waste in the production process. Reducing the production cost of enterprises; keeping pace with consumer market demand, timely adjusting product R&D, production direction, and producing more products with large market space and high profitability, increasing corporate profits; in addition, Chaowei also starts from creating consumption and stimulating the industrial chain. , revitalize the downstream application market, to gain greater profits in the form of expanding the market. Chaowei Group is a sample of cost reduction for lead battery companies.
Batteries China Network believes that the efforts of the industry in the two sessions to cancel or adjust the lead-acid battery excise tax are worthy of recognition, but whether they want to see the policy direction of the relevant departments. The lead storage battery industry still needs further integration and transformation and upgrading. In this crucial period, it is particularly important to reduce the production and operating costs of enterprises and achieve sustainable development.
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