L’Oréal has revealed that it will reduce the prices of its products in China as a result of the government’s decision to lower import taxes.

In an effort to boost the national economy, China’s Ministry of Finance said on Monday that it will cut importation taxes on cosmetics from 5 percent to 2 percent.

The government has also slashed importation taxes on suits, fur garments, shoes and diapers by over 50 percent. 

L’Oréal is the first company to lower its prices as a result of the tax reduction. The more companies that follow suit and lower their prices, the less tempted Chinese consumers will be to shop abroad, thus boosting the national economy.

China’s retail-sales growth has been sliding recently with the economy growing just 7 percent year-over-year in the first quarter 2015 – its worst performance in six years.

L’Oréal is the market leader in China’s US$25bn skincare sector which is set to grow to US$35bn by 2019, according to market researcher Euromonitor. L’Oréal held 13 percent of the market last year, ahead of Japan’s Shiseido and Procter & Gamble.