Mar. 9 – According to the “Report on the Implementation of Central and Local Budgets for 2011 and on Draft Central and Local Budgets for 2012” presented to the National People’s Congress on March 5, China’s key tax reforms in 2012 will focus on six specific types of taxes, namely:
- Property tax (PT)
- Value-added tax (VAT)
- Resource tax (RT)
- Excise tax (ET)
- Environmental protection tax (EPT)
- Urban maintenance and construction tax (UMCT).
PT: Possible expansion to more cities
In a move to curb any housing bubble and restrict speculative buying, China begun a pilot PT reform on second home purchases in the municipalities of Shanghai and Chongqing early last year. This year, in addition to advancing such experiments on buying homes, China will also study and design a plan for reforming taxes on owning and selling real estate. Continue reading…
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…