Collision point of view: fertilizer, "weaning" time is up?

With the advance of the market, fertilizer enterprises enjoy preferential policies being increasingly questioned. Recently, the relevant ministries and finally throws a recovery levy VAT fertilizer draft, to the fertilizer industry "weaned" on the agenda again. Cancellation of VAT, whether the time ripe?

Reform Party last bastion

After looking up, market-oriented reform of the fertilizer industry has been advancing for nine years, in a sense, be regarded as the last bastion of VAT recovery of this reform, the end of this step, be given fertilizer industry completely weaned. July 2005, the National Development and Reform Commission "has been canceled fill two" reform goals, cancel fertilizer price restrictions, cancellation of preferential policies, subsidies farmers. Up to now, fertilizer prices have been completely liberalized, comprehensive agricultural subsidies for farmers are already implemented, these two goals have been achieved. And in a variety of preferential policies, management has taken a gradual reform strategy: fertilizer railway tariffs increase year by year, some provinces have canceled the preferential tariff, the production of nitrogen gas prices have been gradually with the market. It can be said, has the potential to restore the VAT levied fertilizer with no return.

VAT and cancel preferential recovery is a necessary condition for the establishment of the fertilizer industry healthy market operation mechanism for the fertilizer industry, the short-term pain, long-term positive. Different nature, businesses of all sizes through fair competition, Forced to rely on the market, you can eliminate backward production capacity, curb overcapacity conflicts, improve operating efficiency and industrial sectors intrinsic quality.

It is necessary to point out that the reason why the country preferential treatment given to the fertilizer industry, the main purpose is to reduce the burden on farmers, to protect the domestic fertilizer supply, and the current imbalance between supply and demand in the fertilizer industry capacity, excess prominent contradictions in this node introduced policies to promote market-oriented reform measures will not affect domestic fertilizer supply, is unlikely to lead to volatility in fertilizer prices, and thus the time is ripe.

Of course, reform is a systematic project, cancellation policies fertilizer must also formulate corresponding policies. First, the cancellation time limit fertilizer exports, to create a favorable environment for the production and operation of enterprises flexible arrangements; second is to increase direct subsidies to farmers, VAT will be levied on the transfer of subsidies to farmers, to achieve the purpose of industry nurturing agriculture.

Health troubles Party hastily canceled

Develop policies for the fertilizer industry, the focus is not more fertilizer industry itself, and in agriculture, which is the special nature of the support as agricultural fertilizer decisions.

Historically, it is because of a series of preferential policies to support the fertilizer industry, attracting a large number of high-quality resources in the community to enter the fertilizer industry, contributed to the industry leap in the scale and quality of food decade and Chinese agricultural progress made by the indelible contribution. Another point of view, without these concessions, fertilizer industry can not develop so fast, agricultural production naturally can not have this achievement today.

From In this sense, hastily canceled concessions, breaking not only the fertilizer industry, "milk", the final break will be agriculture and farmers' milk. "VAT will be levied was raised back to the farmers, this proposal seems feasible, but given the loopholes in China many scattered small farmers and subsidy policy enforcement, this mode of operation First, high administrative costs, the second is the ultimate can really be subsidies to farmers to implement head fight a big question mark.

On the other hand, if canceled concessions just to promote market-based fertilizer industry, then in fact, as we have seen, the fertilizer market has been in a state of full competition, to cancel or not to cancel, will not change the industry market-oriented development process. Than dwell on the preferential choice of whether or not we should do is to establish a fair and transparent market environment and enforcement environment for fake disappeared.

Thus, despite the fertilizer industry preferential policies have not reasonable place, such as it exists unfairness among other sectors and issues, Again it will affect local fiscal revenue, but in the current situation, in view of China's agriculture is paramount event, the stakes with the right to adequate support for the fertilizer industry is still relatively desirable