China Armco Metals, Inc. (NYSE:CNAM) announced that their subsidiary Armco (Lianyungang) Renewable Metals, Inc. has been certified as a Demonstration Base for Steel Scrap Processing and Distribution by the China Steel Scrap Industrial Associations, which could promise a 50% value added tax (VAT) refund.
As quoted in the press release:
Armco Lianyungang was selected among steel scrap companies in China upon assessment in respect of scale, equipment conditions, quality and environmental management systems and credit rating etc., pursuant to regulations promulgated by the Ministry of Industry and Information Technology of China in October 2012.
China Armco’s President and CEO, Kexuan Yao, said:
We are confident that we will benefit from the certification as well as the possible tax refund. The tax refund when effective could lower our costs and increase our profits by a large margin, which may ease our capital stress and improve our competitive edge. Also, with the certification we are allowed to act as procurement agency for other uncertified companies, which could boost our domestic purchases and total sales.