The current-account surplus, the broadest measure of trade, narrowed to $284.1 billion from a year earlier, the foreign-exchange regulator said in a statement Friday. China?s capital and financial account surplus, which tracks investment flows, was $109.1 billion in 2009, the regulator said, without giving a comparative figure.

A smaller balance of payments surplus may ease pressure on China to resume appreciation in the yuan, which was re-pegged to the dollar in July 2008, following a 21 percent appreciation in the previous three years.

The government this week rejected President Barack Obama?s comments that the currency should be allowed to strengthen, saying the exchange-rate has little effect on the U.S. trade deficit.

The current-account surplus accounted for 5.8 percent of gross domestic product last year, compared with 9.9 percent of GDP in 2008 and 11 percent in 2007, Guan Tao, head of SAFE?s international payments department, said at Friday?s briefing. The decline reflects a shift in China?s economic growth to being less dependent on exports and more driven by domestic consumption, Guan said.

Source : Konaxis

Exports fell 15.2 percent to 115.9 billion dollars year-on-year in September, while imports fell just 3.5 percent, customs authorities said. It was the best result since exports fell by 2.8 percent in December as the global crisis began to set in.

The better-than-expected data was positive for the world’s third-largest economy and gave the government confidence to start reining in massive stimulus measures from next year, said analysts.

For the January to September period, exports slumped 21.3 percent to 846.6 billion dollars.

In the first nine months of 2009, the trade surplus stood at 135.5 billion dollars, down 26 percent year-on-year, the General Administration of Customs said in a statement on its website.

Source : Konaxis

On Sept 15, the Chinese news portal website Sohu.com filed a lawsuit against one of the country’s larger video-sharing websites, Youku.com, for broadcasting unauthorized videos of 503 Chinese movies and TV dramas.

The company, together with video websites Joy.cn and Voole.com, formed an anti-piracy group that pledged to file a series of lawsuits in coming months against companies including Tudou.com and Xunlei, which were charged with the same wrongdoing.

Unlike their foreign counterparts, Chinese video-sharing websites rely heavily on videos such as films and soap operas, partly because comparatively fewer Chinese users record and post their own video clips on the Internet.

That has made Chinese websites more prone to copyright disputes and in direct competing with legal video streaming websites.

According to figures from domestic research firm Analyses International, market revenues of China’s online video industry reached 122 million yuan in the second quarter of this year – up 57.2 percent from a year earlier.

Source : Konaxis

The total value of imports and exports for August was 191.7 billion U.S. dollars, a decrease of 20.6 percent compared with the same month last year, but a 2.3 percent increase from July.

Imports stood at USD88 billion, a decrease of 17 percent compared with the same month last year, an increase of 3.4 percent from July.

Exports dropped 23.4 percent from a year earlier to USD103.7 billion but their value rose 1 percent from July.

Source : Konaxis

Guangdong province is a major economic powerhouse and export base of the nation. Its export suffered greatly since September 2008 due to slumping global demand, trade protectionism and pressure on export price to go down further.

In the second quarter, Guangdong?s exports grew 16.5 percent on the first quarter and total foreign trade was up 34.4 percent.

Guangdong’s total foreign trade declined 20.7 percent in the first half from a year earlier. It included 153.42 billion dollars in export, down 18.6 percent, and 104.45 billion dollars in import, down 23.7 percent.

Source : Konaxis

VAT is the major source of fiscal revenue for the government of China, particularly the central government. In 2007, the revenue from VAT amounted to RMB15.47 billion, accounting for 33.9 percent of China?s total tax revenue for the year ? it accounted for the largest percentage of the China?s annual tax revenues.

The Chinese government rules that all enterprises and individuals engaged in the sale of goods, provision of processing, repairs and replacement services, and import of goods within China shall pay VAT. There are a few exemptions, such as self-produced agricultural products sold by agricultural producers, contraceptive medicines and devices, antique books, importation of instruments and equipment directly used in scientific research, experiment and education, importation of materials and equipment from foreign governments and international organizations as assistance free of charge, articles imported directly by the organizations of the disabled for special use by the disabled, and sale of goods which have been used by the sellers. However, pretty much every business will be liable for this tax.

The VAT rate for general taxpayers is generally 17 percent, or 13 percent for some goods (see table below). For taxpayers who deal in goods or provide taxable services with different tax rates, the sale amounts for the different tax rates shall be accounted for separately. If this is not done, the higher tax rate shall apply.

China VAT calculation for general taxpayers

The VAT payable shall be the balance of output tax for the period, after deducting the input tax for the period. The formula required:

VAT Payable = Output VAT ? Input VAT

Output VAT is calculated based on the value of the taxpayer?s sales, namely
Output VAT = A × B, where A = sales value and B = tax rate

A general taxpayer will usually purchase goods or receive taxable labor services during the course of doing business. The VAT paid by the general taxpayer is Input VAT. The Input VAT is used as a credit against the output tax levied on selling the goods.
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