On the 5th, the second session of the 13th National People's Congress opened in the Great Hall of the People. Premier Li Keqiang of the State Council made a government work report to the conference on behalf of the State Council. Chemical companies are welcoming major benefits, and these points must not be missed!
Larger tax cuts in manufacturing
Reduce the current 16% tax rate in manufacturing and other industries to 13%;
Reduce the current 10% tax rate for transportation, construction and other industries to 9%;
Ensure that all industries' tax burden will only decrease and not increase;
Grasp the implementation of the inclusive tax reduction policy for small and micro enterprises introduced at the beginning of the year.
Chemical industry occupies an important position in the national economy and is an indispensable important part of the national economy. The chemical industry penetrates all aspects and is China's basic industry and pillar industry. According to data from the Ministry of Industry and Information Technology, in 2018, the annual value-added of the petroleum and chemical industry increased by 4.6% year-on-year; the main business income was 12.40 trillion yuan, an increase of 13.6% year-on-year; the total profit was 839.38 billion yuan, an increase of 32.1% year-on-year.
The value-added tax rate of the manufacturing industry has dropped by 3 percentage points, and the tax rate of the transportation industry has dropped by 1 percentage point. This is indeed a major benefit for chemical production enterprises and logistics companies! This drastic tax cut is a major measure to reduce the burden on enterprises and stimulate market vitality. The profitability of chemical companies is expected to increase further.
In 2019, with the launch of several major refining and chemical integration projects, the supply of chemical products in China has changed from a total shortage to a structural shortage. Large-scale general-purpose products are facing overcapacity, and high-end chemicals still need to be broken through. Reducing taxes for chemical companies and reducing expenses in the circulation field will enable companies to invest more in research and development and new project construction, laying a solid foundation for future development.
Reduce the burden of corporate social security contributions
Decrease the contribution rate of urban employees' basic pension insurance units, which can be reduced to 16% in various places;
Do not adopt the practice of increasing the actual payment burden of small and micro enterprises, and do not collect the historical arrears by themselves;
Continue to implement the policy of periodically reducing unemployment and industrial injury insurance rates.
Low payment of social insurance premiums is basically a "secret" disclosed in the industry. Among those enterprises whose social security fees are not paid in full, not paid on time or in insufficient amounts, small and medium-sized enterprises are particularly large. According to data from third-party institutions, before the social security levy reform, only 24.1% of the companies had a fully compliant social security payment base. Why is the proportion of social security compliant companies so low? High rates are fundamental.
This time the reduction of corporate social security contributions has truly achieved "tax reduction and burden reduction", which is a real benefit for all chemical companies, especially small and medium-sized enterprises.
Government work report put forward to ensure that tax reduction and fee reduction are put in place. Tax cuts and fee cuts directly hit the pain points and difficulties of current market players, and are fair and efficient policies. Throughout the year, the burden of corporate taxation and social security contributions was reduced by nearly 2 trillion yuan.
Promote the reform to reduce the fees related to enterprises
Reduce the cost of electricity used in manufacturing, and the average electricity price of general industry and commerce will be reduced by 10%;
Reduce the cost of crossing roads and bridges, and control the unreasonable approval of passenger and freight vehicles and arbitrary charges and fines;
Basically cancel the national highway toll stations within two years;
Cancel or reduce a batch of railway and port charges;
Charges for special governance intermediary services.
Among the various costs of chemical companies, electricity costs have become one of the largest costs immediately following the cost of raw materials and labor costs, especially in some high energy-consuming enterprises, electricity costs have become the most important cost. According to data from the National Bureau of Statistics, from January to November 2018, electricity consumption in the chemical industry was 407.3 billion kWh, an increase of 2.6% year-on-year. The chemical industry has developed rapidly in recent years, and the corresponding power consumption is also increasing day by day. The "favorable" fee reduction will greatly reduce the pressure on the production and operation of enterprises. This is undoubtedly good news for the chemical companies that directly benefit from the “large electricity consumers”.
Continue to promote pollution prevention
Sulfur dioxide and nitrogen oxide emissions decreased by 3%, and chemical oxygen demand and ammonia nitrogen emissions decreased by 2%;
Continue to carry out air pollution control in Beijing-Tianjin-Hebei and surrounding areas, the Yangtze River Delta, and the Fenwei Plain, and strengthen the control of the three major pollution sources of industry, coal, and motor vehicles.
Recently, in order to punish environmental pollution and criminal activities in accordance with law, the Supreme People ’s Court, the Supreme People ’s Procuratorate, the Ministry of Public Security, the Ministry of Justice, and the Ministry of Eco-Environment jointly released the “Minutes on the Symposium on Handling Environmental Criminal Criminal Cases” today Respond and stipulate key and difficult issues in criminal cases of pollution.
For chemical companies and chemical parks, 2019 will usher in higher environmental requirements and stricter pollution penalties. And the second round of "Environmental Protection Inspection" is about to start! From this year, the Ministry of Ecology and Environment will complete the full coverage of the routine inspection in three years, and complete the second round of inspection in one year. This time, the scope is wider and the means more abundant. Relevant departments and central enterprises will be the targets of supervision, and high-tech technologies such as satellite remote sensing, infrared recognition, and drones will also be applied.
Gone are the days of arbitrarily-discharged, extensive production and management. It is imperative for chemical companies to drive product upgrades through innovation, improve their technology, meet environmentally-friendly emissions, produce high-value-added products, and enhance their core competitiveness.
Ease financing difficulties
Increased the targeted reduction of standards for small and medium-sized banks, and all the funds released were used for private and small and micro enterprise loans. Support large-scale commercial banks to replenish capital through multiple channels, enhance credit capacity, and encourage the increase of medium- and long-term loans and credit loans in the manufacturing industry. This year, loans to small and micro enterprises of large state-owned commercial banks will increase by more than 30%.
Difficulties in financing and expensive financing have always been a problem for small and medium-sized enterprises, and chemical enterprises lack credit support for their transformation and upgrading. "The interest rate of general corporate loans is 7.8%, but the financing cost of many small and medium-sized enterprises is generally more than 20%, and some are even more." Some netizens said that for small and medium-sized chemical companies, the general loan can only be plant, equipment, etc. Obtained bank loans as a pledge, but even so, there are still many companies that cannot get loans at all.
After the implementation of the policy, the problem of financing difficulties for private chemical companies, especially small and micro enterprises, is effectively alleviated, which will fully stimulate the vitality and creativity of the private economy.
Conclusion
The National People's Congress and the National People's Congress have begun. This is a major event in the country's political life every year. The two sessions will summarize the national economy and people's livelihood of the past year, and representatives from all walks of life will put forward their own opinions and suggestions. The editor will continue to pay attention to the progress of the two sessions this year, pay attention to the future Chinese economy, and look at the development direction of the chemical industry
