Armco Metals Holdings, Inc., headquartered in San Mateo, California, reports that its Chinese steel recycling business, Armco Renewable Metals, based in Lianyungang, will benefit substantially from China's new incentive policy to offer rebates on value-added tax (VAT) paid by recyclers beginning on July 1, 2015. The rebates will range from 30 percent to 100 percent depending upon the commodity, Armco says, with the rebate for ferrous scrap set for 30 percent.
The VAT rebate policy was once implemented in 2009 and 2010 but was removed in 2011.
The policy effective on July 1, 2015, mainly applies to qualified processing recyclers rather than upstream collectors and downstream steel mills. Armco Renewable Metals reports that it is qualified to receive the rebate.
Armco Metals Holdings says that beginning July 1, 2015, the company's main products—ferrous scrap and waste plastics—will be eligible for a 30 percent and 50 percent tax rebate, respectively. The company's revenue from selling ferrous scrap and waste plastics in the first quarter of 2015 amounted to $15 million, according to a press release issued by the company.
According to the company, the tax rebate may lead to a decrease in costs, an increase in gross profit of around 5 percent per metric ton and an incentive for the utilization of steel scrap by steel mills, as well as support for qualified players in the industry.
Armco Renewable Metals says Chinese tax rebate will boost results
China's Ministry of Finance will offer recyclers VAT rebates beginning in July.