Industry operation of a press conference held yesterday in the China Steel Association, China Steel Industry Association executive vice president Zhang Changfu urged domestic steel companies mentally prepared to do to face the difficulties and long-term "winter". China Steel Association, said the whole industry is facing a situation of high cost and low growth, low profitability is difficult to change during the year.
Rumors of the market concerned about the tax rebate to save the steel prices, the China Steel Association revealed that the relevant departments are studying the recovery to implement an industrial policy called "import substitution". In accordance with this policy, introduced in 1998, a portion of sales to export processing enterprises for processing export products for export processing steel will implement a full refund (or no credit) 17% VAT. The policy was canceled in 2005.
China Steel Association Deputy Secretary-General Li Chong said at the meeting, which in fact is a fair tax burden. He said that the annual domestic steel imports about 15 million tons, divided into general trade and processing imported 700 million tons to 8 million tons of processing imported parts are exempt from tax for domestic enterprises not fair.
China Steel Association also called on the face of the difficult situation of the steel industry, wants the state to alleviate the current difficulties of enterprises through the proactive fiscal policy and structural tax cuts. Eliminate backward enterprise energy saving, import substitution, mergers and acquisitions work to give financial support and tax incentives; pressure Enterprise I, the waste heat, waste gas, waste residue comprehensive utilization, and the domestic mining development to give the necessary tax relief policies and exempt from a variety of funds and charges.
The data show that in the first half of the China Steel Association Member iron and steel enterprises realized a total profit of only 2.385 billion yuan, significantly reduced year on year to 54.549 billion yuan, a decrease of 95.81%; enterprises suffered losses totaling 14.248 billion yuan, the loss of 33.75%. Sales profit margin dropped to 0.13 percent from 3.06 percent in the same period last year, industry profit level has been at a loss edge, if the net investment income, the main steel industry is actually at a loss.
China Steel Association, said the case of steel production capacity continues to grow, the demand for downstream industries decline caused by the weak steel market, prices fell sharply, the cost of raw materials at a high level business marginal profit or even loss of a difficult situation.
To this end, Zhang Changfu control output is to stabilize the steel market, the key factor to reduce the raw materials and fuel prices. Some favorable policies in the second half will be very likely to stimulate the rebound of the steel production, resulting in the increase in inventory of enterprises and society, so that the corporate control of production in the first half of the achievements come to naught. Member companies must remain vigilant and insist on effective insurance reform, to market ability, and effective control of production.
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