Tax Rebate Rate Increase: Policy Vane Is More Significant Than Industry Impact.

In recent years, the Ministry of Finance and the State Administration of taxation have announced that the export rebate rate of some textiles and clothing has increased from 11% to 13% since August 1, 2008, and the export tax rebate rate of some bamboo products has increased to 11%.

We believe that in the short term, the export tax rebate rate will increase by 2 percentage points, which is equivalent to a net profit of 2% of the total export volume of enterprises. For export oriented enterprises, the positive effect of the export tax rebate rate increase is immediate and immediate, and it will help to alleviate the loss situation of SMEs in the textile and garment industry and stabilize employment in the short term.

In the long run, the upward tax rebate rate will not change the downward trend of the industry's profit growth rate. It will not have a significant impact on the annual earnings of listed companies, nor will it change the trend of the decline in export growth, but only slow down the pace of decline and lengthen the decline time.

"Fine-tuning" is the point of "industrial upgrading", which has slowed down the process of market selection. Although the export tax rebate rate increase is beneficial to the recovery of exports, it is beneficial to increase export growth. However, the main beneficiaries are small and medium enterprises, which have limited impact on large and medium enterprises. When the economy is overheating, the main beneficiaries are the integration of industries, the survival of the fittest, and the elimination of a small part of production capacity. However, the unexpected deterioration of the domestic and foreign economic environment has seriously impacted foreign trade export and has increased the pressure of employment. Therefore, labor-intensive SMEs with low added value, low pollution and high employment have to be re supported to reverse losses, stabilize and ease employment pressure.

But at the same time, the change of the national policy actually delayed the process of market selection, to a certain extent, it was retarded the pace of industrial upgrading.

The significance of the "fine tuning" policy vane is far greater than the impact on the single industry. It marks the decision making layer's guidance for the future economic trend, and begins to take fiscal policy as a macro regulation and take substantive action.

It should be said that this will not be a case, but just the beginning. There will be some continuous recruitment or subsequent efforts, such as the "three rural issues", energy conservation and environmental protection, major equipment manufacturing and other supporting policies, high-tech preferential policies and other aspects, which may bring structural investment opportunities to the corresponding sectors.

Whether the fine-tuning policy can adjust market expectations remains to be observed. In addition, policy fine-tuning will help the profit growth of endogenous profits of related companies, which will help to improve or adjust the market's expectation of macro-economic prospects, but whether it is recognized by the market and needs to be played out remains to be seen.