By Edward Barbour-Lacey
Oct. 16 – According to the U.S. Energy Information Administration, last month China imported more oil than any other country in the world, including the United States. China had to import 6.30 million more barrels of oil than it produced domestically, while the United States only imported 6.24 million barrels.
China’s new status will have a number of important ramifications for the country, as it has exposed both the country’s growing strength as well as its weakness. Continue reading
Jan. 24 – Recent sanctions placed on Iran by the United States and European Union, aimed at pressuring the Iranian government into halting its nuclear weapons program with a trade embargo, have caused a serious diplomatic dilemma for China – a major importer of Iranian oil.
The United States has introduced new legislation which will allow for punitive sanctions on foreign banks and businesses facilitating the Iranian oil trade. In a move that demonstrates the conviction of the U.S. authorities for upholding the new law, oil firm Zhuhai Zhenrong has been the first Chinese business placed under sanctions for selling petroleum products to Iran. Continue reading
Jan. 23 – China’s State Administration of Taxation (SAT) recently clarified the tax treatment towards transfers of natural resource use rights.
According to the “Circular on Business Tax (BT) Policies on Natural Resource Use Right Transfers (caishui  No.6)” issued on January 6, 2012, transfers of natural resource use rights – namely transfers of the rights to explore, exploit and employ natural resources – will be regarded as one type of intangible asset transfers. Continue reading
Shenzhen BYD E6 taxi
Dec. 13 – Shenzhen has begun integrating electric vehicles into its public transport with the recent commercial introduction of local auto-maker BYD’s vehicles appearing on the city streets. An initial fleet of some 300 e-taxis are now plying the roads. Named the E6, the vehicle offers enough space for five passengers and has a range of some 160 kilometers. Plans are currently being put into place to convert all of Shenzhen’s public vehicular transport to electric – including buses and all taxis – over the next five years. Continue reading
Posted in Automotive, Business, Markets, Oil & Petroleum, Science and Tech, South China, Technology
Tagged BYD, China Auto, China Electric Vehicles, Shenzhen, Shenzhen E-Taxi, Shenzhen Public Transportation, Warren Buffett
Resource companies to face heavier tax burdens
Oct. 13 – After being delayed twice, China’s resource tax reform is finally going national. Starting on November 1, crude oil and natural gas will be taxed based on sales rather than the amount of production, and coking coal as well as rare earths will be subject to higher tax rates.
Based on the “Interim Provisions on Resource Tax of the People’s Republic of China (State Council Decree No.139)” released back in 1993, China’s State Council issued Decree No.605 on September 30 and announced the new amendments to the regulations. While the Chinese government says the reform is mainly for the purpose of resource conservation and environmental damage reduction, Western analysts believe the move will also cause a larger portion of resource companies’ profits to flow to local governments’ pocket. Continue reading
Posted in Finance, Tax and Accounting, Legal and Regulatory, Oil & Petroleum, Regulatory Update, Science and Tech
Tagged China Coal, China Energy, China Natural Gas, China Natural Resources, China Oil, China Rare Earths, China Tax Reform, Coking coal, Crude oil, Energy companies
Oct. 10 – As the world’s second largest energy consumer, China is paying every effort to develop clean and unconventional energy in order to meet the needs of the country’s surging demand for energy. As such, the Chinese government has recently indicated that new incentives may be given to businesses so that they can participate in the exploration of the country’s potentially huge shale gas reserves.
The Chinese government is considering establishing shale gas – the source of natural gas that has become increasingly important over the past decade – as an independent resource from conventional hydrocarbons, so that “companies with strong financial standing and technology may participate in bidding,” according to Che Changbo, deputy director of oil and gas at the strategic center of the Ministry of Land and Mineral Resources. Currently, China’s shale gas exploration is still in its early stages with no commercial production. Continue reading
Sept. 5 – China’s rapidly increasing domestic demand for energy is driving the country to boost its production of key natural resources. In the three documents released on August 8, the Ministry of Finance (MoF), the General Administration of Customs (GAoC) and the State Administration of Taxation (SAT) together announced the decision to exempt coal bed methane (CBM), oil, and natural gas exploration equipment from import duties.
Tariff elimination on CBM equipments
According to the “Circular on Import Duty Exemption for CBM Exploration and Development Materials (caiguanshui  No.30),” during China’s 12th Five-Year-Plan period between January 1, 2011 and December 31, 2015, China CBM Group Co. Ltd. – the company that explores for, develops and produces CBM – is exempt from both tariffs and value-added tax when importing equipment, instruments, machinery and accessories that are directly used for developing CBM resources. CBM Group’s domestic and foreign partners are also able to receive the same tax incentive. Continue reading
Jul. 4 – Following its announcement in December last year that pure biodiesel made from waste plant and animal oil is exempt from consumption tax, the Chinese government has recently clarified the actual scope of animal and plant oils subject to such tax exemption. Experts say the tax incentives will not only largely support China’s emerging biodiesel market, but will also effectively prevent waste oil from flowing back to dining tables. Continue reading