SHANGHAI, Nov. 20 (SMM) – Resource tax on rare earths in China may increase markedly as the government plans to levy the tax based on sales value instead of volumes, Economic Information reported today.

China is expected to impose a 22% ad valorem tax on light rare earths in north China and the tax rate may be set at 35% on ionic rare earths in south China, according to a preliminary proposal.

Experts believe the resource tax reform may bode well for rare earth prices. However, some worry the tax hike may add to burden on qualified producers and facilitate illegal mining operations.

China set a resource tax on light rare earths, including bastnaesite and monazite, at 60 yuan ($9.77) per tonne since April 2011, while the tax on medium and heavy rare earths was determined at 30 yuan a tonne.  
 

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