Officials say China’s resource tax reforms will help many industries in the country. China previously levied fixed resource taxes based on the amount of goods sold, regardless of price.
But tax authorities started to reform the resource sector in 2010 by basing the tax on sales. Sales-based taxes now cover six resources categories, including oil, gas, and coal.
The reform will cover all resource sectors starting July 1. Officials say the reform will benefit businesses and help preserve natural resources.
“Businesses would pay taxes based on their sales. This would help them grow sustainably. For local governments, a rise in prices would bring in more tax revenues and benefit public spending. For the country’s environment, the change would stimulate environment protection, and economic use of natural resources,” said Sun Ruibiao, vice administrator of State Administration of Taxation.