China to raise export tax rebates for 397 items

China on Friday announced that it would elevate export tax rebates for 397 products, including mechanical, cultural and electronic goods, to support prospects for shipments in the face of trade tension with the US.

Tax rebate rates for items including chemicals, lithium batteries light-emitting diodes (LEDs), multicomponent integrated circuits, non-electromagnetic interference filters books, newspapers, would be increased to 16%, the Chinese Ministry of Finance stated on its website.

While Beijing estimates a 16% value-added tax (VAT) on certain exports, raising the rebates mean that exporters redeem the full amount paid.

The rebate will also be increased for stainless steel products to 9% and steel pipes to 13%, according to the ministry.

The ministry did not mention the current amount of rebates on those products.

The move came after Chinese state council’s decision to increase the rate of export tax rebates for a number of products last week.

“This is in effect to negate the impact from US tariffs,” Commerce Ministry-affiliated think tank researcher Mei Xinyu told Thomson Reuters.

The measure came amid anticipations on whether US President Donald Trump will implement tariffs on an additional $200 billion in Chinese imports, after the period for public comment on the measure has ended in Washington.

Until now, the world’s largest two economies slapped duties on $50 billion in one another’s goods.