Comprehensive Analysis of Customs Duty Exemption Code

Published: 07/21/2025
Customs Import and Export Tax Exemption
The Customs Tax Exemption Code System provides structured information for managing tax reductions and exemptions. The article analyzes the classification and definitions of exemption types, including general taxation, gratuitous assistance, and specific tax exemptions, each corresponding to different customs codes. These codes help identify and classify import and export goods, facilitating tax processes and supporting trade efficiency. Understanding these codes allows professionals to effectively navigate the complexities of the international trade environment.
Comprehensive Analysis of Customs Duty Exemption Code

Customs duty exemption codes serve as crucial tools for managing duty reductions and exemptions in China. Their primary purpose is to classify and statistically analyze import/export goods, supporting customs administration while providing foundational data for automated customs declaration and EDI clearance systems. Below is a detailed analysis of these codes.

I. Classification of Duty Exemption Categories

Duty exemption categories are divided into five major types:

  1. Statutory taxation according to regulations
  2. Statutory duty exemptions
  3. Special duty exemptions
  4. Other duty exemptions
  5. Provisional tariff rates

Special duty exemptions are further subdivided into:

  • Region-specific tax policies
  • Purpose-specific tax policies
  • Trade-specific tax policies
  • Enterprise-specific and funding source-based policies

II. Code Structure

Duty exemption codes consist of three digits: the first digit represents the category, while the second and third digits indicate the sequential number of the exemption item within that category.

Detailed Classification and Definitions

1. General Taxation for Import/Export Goods

Definition: Goods subject to standard tariffs, VAT, and other applicable fees as stipulated by relevant laws and regulations.

Code: 101 (General Taxation)

Scope: All import/export goods not covered by special exemption provisions.

2. Gratuitous Aid Materials

Definition: Materials provided as gratuitous aid or gifts from foreign governments or international organizations.

Code: 201 (Gratuitous Aid)

Scope: Includes goods donated through government agreements and materials from UN or other international organizations.

3. Other Statutory Duty Exemptions

Definition: Goods qualifying for duty exemptions under specific legal provisions.

Code: 299 (Other Statutory)

Scope: Includes compensation goods without cost, non-commercial advertising materials, and partially damaged goods.

4. Special Economic Zone Imports

Definition: Self-use materials imported within special economic zones.

Code: 301 (Special Zones)

Scope: Materials imported within quota limits by zone-based enterprises and institutions.

5. Bonded Zone Imports

Definition: Materials imported under special policies for bonded zones.

Code: 307 (Bonded Zones)

Scope: Infrastructure construction materials and production equipment.

6. Other Special Policy Zone Exports

Definition: Export goods from high-tech zones and other special policy areas.

Code: 399 (Other Zones)

Scope: Export products manufactured by enterprises in these zones.

7. Scientific/Educational Imports

Definition: Materials imported to support scientific research and education.

Code: 401 (Scientific/Educational)

Scope: For State Council-approved research and educational institutions.

8. Enterprise Technology Upgrade Imports

Definition: Equipment imported for technological transformation and upgrading.

Code: 403 (Technology Upgrade)

Scope: Equipment and instruments required for upgrade projects.

9. National Major Project Imports

Definition: Goods for State Council-approved major construction projects.

Code: 406 (Major Projects)

Scope: Equipment for approved national projects.

10. Infrastructure Construction Equipment

Definition: Equipment specifically for communications, ports, and other infrastructure.

Code: 412 (Infrastructure)

Scope: Relevant machinery and equipment.

11. Disabled Persons' Special Equipment

Definition: Imported materials supporting independent living for disabled persons.

Code: 413 (Disabled Persons)

Scope: Includes personal and enterprise-produced disability equipment.

12. Distant-Water Fishery Products

Definition: Aquatic products harvested by authorized distant-water fishing enterprises.

Code: 417 (Distant-Water Fishing)

13. Designated Auto/Camera Manufacturers' Parts

Definition: Imported components for state-designated automobile and camera manufacturers.

Code: 418 (Domestic Production)

14. Exploration/Development Equipment

Definition: Equipment for offshore and onshore oil exploration.

Code: 606 (Offshore Oil), 608 (Onshore Oil)

15. Disaster Relief Donations

Definition: Materials donated to disaster areas without compensation.

Code: 801 (Disaster Relief)

16. Processing Trade Equipment

Definition: Equipment provided without compensation by foreign partners.

Code: 501 (Processing Equipment)

17. Processing/Compensation Trade Materials

Definition: Materials imported for processing and compensation trade.

Code: 502 (Processing Trade)

18. Import Materials for Export Processing

Definition: Raw materials imported for export product manufacturing.

Code: 503 (Export Processing)

19. Border Small-Scale Trade

Definition: Import goods under small-scale trade in border areas.

Code: 506 (Border Trade)

20. Sino-Foreign Joint Venture Imports

Definition: Materials imported by joint ventures and cooperative enterprises.

Code: 601 (Joint Ventures), 602 (Cooperative Enterprises)

21. Wholly Foreign-Owned Enterprise Imports

Definition: Materials imported by foreign-owned enterprises in China.

Code: 603 (Foreign Enterprises)

22. Foreign Government Loan Equipment

Definition: Equipment imported under approved foreign loan projects.

Code: 609 (Loan Projects)

23. National Encouraged Project Equipment

Definition: Equipment imports qualifying under national encouragement policies.

Code: 789 (Encouraged Projects)

24. State Council Special Exemptions

Definition: Goods granted special exemptions by the State Council.

Code: 898 (State-Approved)

25. Exceptional Exemptions

Definition: Goods not fitting other exemption categories.

Code: 999 (Exceptional)

26. Provisional Tariff Rate Goods

Definition: Goods qualifying for provisional tariff rates.

Code: 998 (Provisional Rate)

Understanding these customs duty exemption codes is essential for efficient import/export operations and proper tax documentation. They play an indispensable role in enhancing national tax administration and trade facilitation. Industry professionals should master this knowledge to optimize operations and navigate complex international trade environments effectively.

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