More tariffs and more tax cuts for China

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The U.S. is preparing new tariffs against all remaining Chinese imports if talks between Presidents Donald Trump and Xi Jinping fail. New tariffs against all goods from China might be announced in December. They would target the $257 billion in imports from China which are not already under tariff.

China is looking at major tax cuts to boost its economy.

China is looking to reduce its car taxes from 10% to 5%.

In 2019, China is also looking at tax cuts equal to about 1% of GDP.

A tax cut equal to 1 percent of GDP next year would be at least 827 billion yuan. China has already had 1.3 trillion yuan of tax reductions estimated by Beijing for this year.

China is offsetting the reduced exports from tariffs with tax cut economic stimulation and allowing the yuan to devalue. The yuan has devalued by about 10% since April.

59 thoughts on “More tariffs and more tax cuts for China”

  1. I still do not understand why China has not fought back and is not fighting back strongly apparentlySay, for example buying 100% of iranian oil or sell them 100 fighter jets What are they waiting for? Duo Luca Mazza

  4. But, but China has MORE RICH people than we do! All those rich Chinese getting tax cuts!Why isn’t the Left having a cow over this?Because their is no virtual signaling ROI for doing so outside the US, that’s why.

  5. “ur benevolent leader on the other hand has targeted the estate tax for high wealth individuals”Uh…because they pay the most in tax revenues. Duh!” WHAT taxes you cut, HOW you phase them in, WHAT and HOW you tariff are all very important questions. “Yes, like how Trump allowed 100% depreciation along with corporate income tax cuts has started a boom in our economy. I understand this concept quite well.”ts a matter of technique. And, just like with his goddamn tweets, trump has NO GAME. Not here, not in diplomacy, not anywhere. “Who gives a shyte what you think about his tweets? I like his tweets and how the humiliate ‘diplomacy’. ‘Diplomacy’ just screws America, over and over again. To hell with ‘diplomacy’.

  6. “ur benevolent leader on the other hand has targeted the estate tax for high wealth individuals”

    Uh…because they pay the most in tax revenues. Duh!

    ” WHAT taxes you cut, HOW you phase them in, WHAT and HOW you tariff are all very important questions. ”

    Yes, like how Trump allowed 100% depreciation along with corporate income tax cuts has started a boom in our economy. I understand this concept quite well.

    “ts a matter of technique. And, just like with his goddamn tweets, trump has NO GAME. Not here, not in diplomacy, not anywhere. ”

    Who gives a shyte what you think about his tweets? I like his tweets and how the humiliate ‘diplomacy’. ‘Diplomacy’ just screws America, over and over again.

    To hell with ‘diplomacy’.

  7. A little less than half of the population of China. Economically much smaller. And Chinese make up most of the business owners who all have family connections back home.

  8. A little less than half of the population of China. Economically much smaller. And Chinese make up most of the business owners who all have family connections back home.

  9. warren, did you even read the corresponding links?no, of course not.the tax cuts that china are proposing are:1. a 50% cut in taxes for cars with engines of less than 1.6 litres2. a deduction against tax of 1,000 yuan a month for interest payments on home mortgages, 3. a deduction of 800 to 1,200 yuan a month for rental payments.4. a deduction of 12,000 yuan per year for a child’s education, 5. a deduction 60,000 yuan per year for medical expenses above a base amount.aside from #4, these are *hardly* regressive, ie: they are tax cuts where there should be tax cuts, IN THE HANDS OF CONSUMERS so they can rise up the economic ladder.Our benevolent leader on the other hand has targeted the estate tax for high wealth individuals, with 83% going to large scale corporations and those making 1 million or more in income. And he is wanting to cut them further:here’s the thing you don’t get warren – its not like ‘tax cuts’ or ‘tariffs’ are in their nature dirty words; WHAT taxes you cut, HOW you phase them in, WHAT and HOW you tariff are all very important questions. Its a matter of technique. And, just like with his goddamn tweets, trump has NO GAME. Not here, not in diplomacy, not anywhere.what an embarrassment.

  11. warren, did you even read the corresponding links?

    no, of course not.

    the tax cuts that china are proposing are:

    1. a 50% cut in taxes for cars with engines of less than 1.6 litres
    2. a deduction against tax of 1,000 yuan a month for interest payments on home mortgages,
    3. a deduction of 800 to 1,200 yuan a month for rental payments.
    4. a deduction of 12,000 yuan per year for a child’s education,
    5. a deduction 60,000 yuan per year for medical expenses above a base amount.

    aside from #4, these are *hardly* regressive, ie: they are tax cuts where there should be tax cuts, IN THE HANDS OF CONSUMERS so they can rise up the economic ladder.

    Our benevolent leader on the other hand has targeted the estate tax for high wealth individuals, with 83% going to large scale corporations and those making 1 million or more in income. And he is wanting to cut them further:

    https://www.independent.co.uk/news/world/americas/trump-tax-cut-superrich-billions-us-president-wealthy-washington-a8470736.html

    here’s the thing you don’t get warren – its not like ‘tax cuts’ or ‘tariffs’ are in their nature dirty words; WHAT taxes you cut, HOW you phase them in, WHAT and HOW you tariff are all very important questions.

    Its a matter of technique. And, just like with his goddamn tweets, trump has NO GAME. Not here, not in diplomacy, not anywhere.

    what an embarrassment.

  13. I doubt Vietnam can pick up all of China’s slack. Also the Vietnamese know that this is only temporary so while the are willing to do longer hours they won’t be spending a lot of capital to expand.

  14. I doubt Vietnam can pick up all of China’s slack. Also the Vietnamese know that this is only temporary so while the are willing to do longer hours they won’t be spending a lot of capital to expand.

  18. Why anyone who disagreed with you must be necesarily be a troll? Russian pension money for spies like me is paid in euros 🙂

  22. Bunch of bull.. 1) China export to US are just 18% of total exports, they can find new markets 2) They can increase employment by making more debt, the us can not 3) the US wll not be able to buy cheap stuff anymore so the US will be hit as bad (is hit as bad) 4) China public debt is 50% and less, in the US you have 105% Luca Mazza

  28. Bunch of bull..
    1) China export to US are just 18% of total exports, they can find new markets
    2) They can increase employment by making more debt, the us can not

    3) the US wll not be able to buy cheap stuff anymore so the US will be hit as bad (is hit as bad)
    4) China public debt is 50% and less, in the US you have 105%

    Luca Mazza

  29. It isn’t quite that simple. Some manufacturers in places like Vietnam are already picking up the slack (and will expand to fill that demand), so ones still in China are actually going to suffer increased competition combined with decreased world market access (because Vietnam can sell to USA tariff free).

  30. Chinese average wages in manufacturing is 64452 CNY ($9,250). The trade deficit with the USA is 375 billion per year for 2017.Squeeze that down by half (187.5 billion) and it can kill 20 million jobs in China. In a labor force of 786 million, that is an increase in unemployment by 2.54% percentage points. China likes to have just under 4% unemployment rate for social stability goals.Now count in the cost of servicing foreign denominated debt for Chinese businesses when you devalue by 10%. 1.75 trillion dollars (14% of GDP). So 11% of that (a similar number).So a long-term hit of 3% increase of unemployment and a 1.4% hit to GDP (probably spread over 3 years or so) for every 10% devaluation. If that foreign debt mostly hits export businesses, the likely fallout will be more laid off workers worth another 1.5% increase of unemployment (call it 0.5% per year for 3 years) if 50% does.It’s actually worse than that because there’s “shadow banking” debt that needs to be rolled over in the short term. Chinese central government loosening can only reach that market indirectly due to new anti-shadow banking regulations. 7-15 trillion USD total (depending on your definition).China’s usual methods of creating jobs (dumping money into unprofitable state owned enterprises) will eventually reach that Minsky moment where debt is just too high to consider it. When exactly? Who knows. Sooner than later with this trade ware.

  31. You do know what secondary sanctions are don’t you??? I can’t see them making much of a difference in arms sales (I’m not 100% sure about this because the money has to flow from Iran to China somehow and anybody on that chain could get targeted) but any companies that bought oil from Iran would really get slammed by them.

  32. I wasn’t contradicting what you said before. But regarding Democratic Defense Hawks don’t confuse them with War Hawks because the party rightfully has few of those. Note, Democratic Defense Hawks are often driven buy a need to support local Defense Industries in their state or district.

  33. So?How does that stop Trump from raising the tariffs, which he can do because Congress gave POTUS’ that right via legislation long ago?Ditto with doing something totally Trumpian like recognizing Taiwanese independence? Congress can’t stop him from doing eitehr.” I say maybe because there are enough Democratic Defense Hawks “No such thing. Dem Party has gone Full Metal Libtard now.

  34. I still do not understand why China has not fought back and is not fighting back strongly apparently”Because Trump has them by the gonads despite how clueless you are regarding how the world truly works.

  35. The big thing the control of the House gives is control on the budget. It means no more Wall and maybe a smaller defense budget… I say maybe because there are enough Democratic Defense Hawks that military budgets often get left as is if there is enough money to go around (which there hasn’t been since the Bush era.)

  36. The Chinese imposed tariffs have basically shut down US imports to China but here in the US we need to keep buying Chinese goods at an increased price because there is no other realistic choice.

  39. …not with the Tariffs.And if it is true that they are interfering in our election against Trump, they can’t stop a very PO’d Trump from doing something like…recognizing Taiwan as an independent nation.

  40. But, but China has MORE RICH people than we do! All those rich Chinese getting tax cuts!Why isn’t the Left having a cow over this?Because their is no virtual signaling ROI for doing so outside the US, that’s why.

  41. It isn’t quite that simple. Some manufacturers in places like Vietnam are already picking up the slack (and will expand to fill that demand), so ones still in China are actually going to suffer increased competition combined with decreased world market access (because Vietnam can sell to USA tariff free).

  42. Chinese average wages in manufacturing is 64452 CNY ($9,250). The trade deficit with the USA is 375 billion per year for 2017.

    Squeeze that down by half (187.5 billion) and it can kill 20 million jobs in China. In a labor force of 786 million, that is an increase in unemployment by 2.54% percentage points. China likes to have just under 4% unemployment rate for social stability goals.

    Now count in the cost of servicing foreign denominated debt for Chinese businesses when you devalue by 10%. 1.75 trillion dollars (14% of GDP). So 11% of that (a similar number).

    So a long-term hit of 3% increase of unemployment and a 1.4% hit to GDP (probably spread over 3 years or so) for every 10% devaluation. If that foreign debt mostly hits export businesses, the likely fallout will be more laid off workers worth another 1.5% increase of unemployment (call it 0.5% per year for 3 years) if 50% does.

    It’s actually worse than that because there’s “shadow banking” debt that needs to be rolled over in the short term. Chinese central government loosening can only reach that market indirectly due to new anti-shadow banking regulations. 7-15 trillion USD total (depending on your definition).

    China’s usual methods of creating jobs (dumping money into unprofitable state owned enterprises) will eventually reach that Minsky moment where debt is just too high to consider it. When exactly? Who knows. Sooner than later with this trade ware.

  43. You do know what secondary sanctions are don’t you??? I can’t see them making much of a difference in arms sales (I’m not 100% sure about this because the money has to flow from Iran to China somehow and anybody on that chain could get targeted) but any companies that bought oil from Iran would really get slammed by them.

  44. I wasn’t contradicting what you said before. But regarding Democratic Defense Hawks don’t confuse them with War Hawks because the party rightfully has few of those. Note, Democratic Defense Hawks are often driven buy a need to support local Defense Industries in their state or district.

  45. So?

    How does that stop Trump from raising the tariffs, which he can do because Congress gave POTUS’ that right via legislation long ago?

    Ditto with doing something totally Trumpian like recognizing Taiwanese independence?

    Congress can’t stop him from doing eitehr.

    ” I say maybe because there are enough Democratic Defense Hawks ”

    No such thing. Dem Party has gone Full Metal Libtard now.

  46. “I still do not understand why China has not fought back and is not fighting back strongly apparently”

    Because Trump has them by the gonads despite how clueless you are regarding how the world truly works.

  47. The big thing the control of the House gives is control on the budget. It means no more Wall and maybe a smaller defense budget… I say maybe because there are enough Democratic Defense Hawks that military budgets often get left as is if there is enough money to go around (which there hasn’t been since the Bush era.)

  48. The Chinese imposed tariffs have basically shut down US imports to China but here in the US we need to keep buying Chinese goods at an increased price because there is no other realistic choice.

  51. They’re waiting for the results of our mid term elections most likely. If the Democrats win control of the House it will seriously tie Trumps hands.

  52. …not with the Tariffs.

    And if it is true that they are interfering in our election against Trump, they can’t stop a very PO’d Trump from doing something like…recognizing Taiwan as an independent nation.

  53. But, but China has MORE RICH people than we do! All those rich Chinese getting tax cuts!

    Why isn’t the Left having a cow over this?

    Because their is no virtual signaling ROI for doing so outside the US, that’s why.

  54. They’re waiting for the results of our mid term elections most likely. If the Democrats win control of the House it will seriously tie Trumps hands.

  55. So Matheus you always sign Luca Mazza. You trolls should be more careful. You are wasting Russian pension money.

  56. That will provoke not only more severe tariffs but also sanctions from the US. US holds a lot larger levers and longer sticks. What I don’t understand why China is behaving so irrationally and continues to resist. I guess that is what happens when one person makes all the decisions.

  57. I still do not understand why China has not fought back and is not fighting back strongly apparentlySay, for example buying 100% of iranian oil or sell them 100 fighter jets What are they waiting for? Duo Luca Mazza

  59. I still do not understand why China has not fought back and is not fighting back strongly apparently
    Say, for example buying 100% of iranian oil or sell them 100 fighter jets
    What are they waiting for?
    Dunno

    Luca Mazza

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