After experiencing a long-term game between the parties, the U.S. Senate finally passed the largest tax reform program in nearly 30 years with a total amount of up to 1.5 trillion U.S. dollars.As the world's largest economy, such a drastic reform, Undoubtedly will have a huge spillover effect on the world economy.
At present, the impact of the tax reform in the United States on China's economy has been heard by both Chinese and foreign media and think tanks. However, the focus has remained on macroeconomics and finance. The tax reform in the United States will have a long-term impact on China's household electrical appliance enterprises because: the United States is China The largest home appliance export market.
According to the statistics of the Customs, in 2016, China exported 70.71 billion yuan of home appliances to the United States and over 50% of the 43.96 billion yuan higher than the EU's second largest export market.
From the above two sets of air conditioning and refrigerator export data shows that the US market for China's home appliance exports occupy an extremely important position, the other by monitoring the shipping side can also confirm this.
So the United States 30 years the largest tax reform will affect the Chinese home appliances geometry?
First, reducing the tax will stimulate US domestic consumption
First, from the most direct impact, the reduction of tax burden means that the disposable income of U.S. residents and the decline in the cost of production and operation of enterprises will undoubtedly stimulate household consumption while increasing corporate profits, reinvesting enterprises and boosting economic vitality.
It is estimated that this plan will increase real GDP in the United States by more than 9%, increase real wages by 8%, create at least 2 million new permanent full-time jobs, and save an annual tax of $ 1,182 per U.S. home, which In the United States, where consumerism prevails, it means the growth of total consumption.
Second, the dollar returned to the appreciation channel to export well
It is noteworthy that the tax reform in the United States is based on the fiscal policy of the United States 'rate hike + shrink chart', raising interest rates is to increase the exchange rate of the U.S. dollar and the appreciation of the U.S. dollar. The principle of shrinking the chart is similar to that of the Federal Reserve to take over the market The dollar.
Export of household appliances industry is more sensitive to the exchange rate, the renminbi continued to appreciate against the U.S. dollar in the near term, which severely squeezed the profit margin of the export business of China's household electrical appliance enterprises. Some of the export business of SMEs even caused losses due to foreign currency exchange risk. However, the appreciation of the U.S. dollar will to a certain extent Stimulate the export of Chinese home appliances.
Third, manufacturing capacity may be transferred to the United States
For China's home appliance enterprises, while absolutely leading the world in terms of manufacturing scale and capability, home appliances, as one of China's most advantageous export products, will bear great policy pressure after the rise of new trade protectionism. .
Taking the case of the U.S.-based Whirlpool suing Samsung and LG washing machines for dumping at the beginning of the year as an example, the competition between international home appliance brands has been intensified on the one hand, and the combination of protectionism and brand protectionism has also been demonstrated on the other. Samsung Electronics plans to invest 300 million U.S. dollars to build a home appliance manufacturing plant in the United States to produce washing machines and gas stoves. LG Electronics plans to invest 250 million U.S. dollars to build a new washing machine factory in Tennessee, the United States.
As the US corporate income tax will be lowered from 35% to 20% and a series of preferential tax policies, the operating pressure of enterprises will drop substantially, a move that will further attract manufacturing enterprises to invest in the United States.
The core appeal of the U.S. government's tax reduction policy lies in the "reindustrialization" of the United States. Therefore, the home appliance enterprises can actively layout the U.S. production line or home appliance brand. This can not only prevent the U.S. government from suppressing the export business but also combine with the developed U.S. technology industry , Research and develop high-end products, and nurture the brand and products and technological advantages through the good performance in the North American market to China and other emerging countries.