While the news of Chinese government’s action to clamp down circumvention of steel export policies by most of the steel mills as boron added has been circulating for quite some time, it seems to be gaining strength this week.

As per latest reports, some of the Chinese steel exporters have raised red flag during negotiations for new deals that the VAT rebate structure may undergo change. It seems that the sellers want the buyers to agree to share the extra burden amount, which most buyers would not agree as not only the extent of extra burden is not known but changes the import vis- a-vis domestic sourcing dynamics

Chinese mills have stepped up steel exports in last 6 months to India to almost 1 million tonnes up by 111% YoY mostly by circumventing the export tax for some products and availing VAT rebate by changing classification to alloy steel by adding 0.0008% Boron

Given below is the existing export tax and VAT rebate on some steel products from China and total benefit on boron added steel exports….

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