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China’s Resource Tax Law simplifies tax declaration process, but has slight impact on costs

iconSep 4, 2020 15:53
Source:SMM
China's resource tax law came into effect on September 1, tax on nickel concentrate remains at 4%.

SHANGHAI, Sep 4 (SMM) — China's resource tax law came into effect on September 1, tax on nickel concentrate remains at 4%.

 

Resource Tax Law of the People's Republic of China came into effect on September 1. The new law, based on the provisional regulations on resource tax, introduces unified tax items, clarifies the authorisation for determining tax rates, and standardises tax reduction and exemption policies.

 

The Resource Tax Law comprises 164 tax items that cover all discovered minerals and salts, and sets tax rates in categories in an effort to streamline tax declaration.

 

Under the law, tax authorities and related departments must establish cooperation mechanisms to enhance the management of levying the resource tax, while safeguarding the legitimate rights and interests of taxpayers

 

The rate for nonferrous metals such as zinc, lead, tin and nickel is lifted to 2%-10% from 2%-6%. The tax in major production areas of nickel ore are as follows:

 

 

The resource tax on nickel ore largely unchanged. The tax of concentrate tax is expected to be adopted widely as nickel concentrate for private use is more common among domestic enterprises.

 

Impact on ore enterprises

Insignificant cost impact: The resource tax has been changed from the quantity-based method to the ad valorem-based method since 2016. This made up for the shortage that the resource tax was not related to the ore prices.

 

The new law sets 15 days as the deadline of tax declaration, consistent with other taxes, reducing the tax burden for taxpayers.

 

The sales volume was difficult to account for as various kinds of metals as domestic nickel ore were associated ore of copper, cobalt or nickel. The new resource tax law set tax for both raw ore and concentrate, which was convenient for declaration and business operating.

Resources Tax Law

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