Circular on Comprehensively Promoting the Reform of Resource Tax
Circular on Comprehensively Promoting the Reform of Resource Tax
Circular on Comprehensively Promoting the Reform of Resource Tax
Cai Shui [2016] No. 53
May 9, 2016
The people's Governments of all provinces, autonomous regions, municipalities directly under the Central Government and cities specifically designated in the state plan, and all ministries and commissions of and all institutions directly under the State Council,
In accordance with the decisions and arrangements of the Party Central Committee and the State Council, in order to deepen the reform of the fiscal and taxation systems, promote the economical and intensive utilization of resources, and accelerate the construction of ecological civilization, the matters relating to the overall promotion of the reform of resource tax are hereby notified as follows:
I. Guiding Ideology, Fundamental Principles and Main Objectives of the Reform of Resource Tax
1. Guiding Ideology
Fully implementing the guiding principles of the 18th National Congress of the Communist Party of China ("CPC") and the Third, Fourth and Fifth Plenary Sessions of the 18th CPC Central Committee, in accordance with the "Five in One" overall layout and "Four-Pronged Comprehensive" strategic layout, it is imperative to firmly establish and implement the development concepts of innovation, coordination, green, openness and sharing, fully promote the reform of resource tax, effectively give play to the regulating role of tax lever, facilitate the continuous and healthy development of the resource industry, and promote the adjustment of economic structure and transformation of development mode.
2. Fundamental Principles
The first is integration of fees with taxes. Efforts shall be made to resolve the current issues of overlapping of fees and taxes and interleaving of functions, properly incorporate the fees and funds such as the mineral resource compensation fees into resource tax, abolish all types of fees and funds established in violation of regulations or ultra vires, and further straighten out the relationship between fees and taxes.
The second is reasonable burden. By considering the practical circumstances of enterprises and their abilities to assume burden and learning from the fee and tax reform experiences for coal and other resources, taxation base and tax rate level for resource tax shall be reasonably determined, so as to increase flexibility for taxation and on the whole not to increase the tax burden of enterprises.
The third is proper devolution of authority. In view of the practical circumstances of our country, such as imbalanced distribution of resources and relatively large regional differences, on the premise that the order of the national unified market is not affected, the tax administration authority shall be properly devolved to local governments.
The fourth is progressive improvement. Based on the implementation of the reform of ad valorem taxation for coal, crude oil and natural gas, reform shall be fully implemented for other mineral resources. Conditions shall be created to gradually levy resource tax on natural resources such as water, forest, grassland, and mudflat.
3. Main Objectives
By way of fully implementing the integration of fees with taxes and the reform of ad valorem taxation, the relationship between resource tax and fees shall be straightened out, and a resource tax regime shall be established with fair norms, reasonable regulation and efficient collection, so as to effectively play its role of coordinating the revenue, regulating the economy, promoting the economical and intensive utilization of resources and protecting the ecological environment.
II. Main Contents of the Reform of Resource Tax
1. Enlargement of the Scope of Levy of Resource Tax
(1) Carry out the pilot program of water resource tax reform. In light of the wide scope involved in the extraction of water resources and their complicated circumstances, in order to ensure the smooth and orderly implementation of the reform, the pilot program of water resource tax reform shall be firstly carried out in Hebei Province. In carrying out the pilot program of water resource tax reform, Hebei Province shall adopt the mode of converting water resource fee to tax, include surface water and underground water in the scope of taxation, implement the volume-based taxation and properly increase the tax amount standards for water-intensive industry, off-plan usage of water and extraction of underground water in areas where groundwater is over-exploited, whilst the original level of burden for normal usage of water for production and living will remain unchanged.
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Cai Shui [2016] No. 53
May 9, 2016
The people's Governments of all provinces, autonomous regions, municipalities directly under the Central Government and cities specifically designated in the state plan, and all ministries and commissions of and all institutions directly under the State Council,
In accordance with the decisions and arrangements of the Party Central Committee and the State Council, in order to deepen the reform of the fiscal and taxation systems, promote the economical and intensive utilization of resources, and accelerate the construction of ecological civilization, the matters relating to the overall promotion of the reform of resource tax are hereby notified as follows:
I. Guiding Ideology, Fundamental Principles and Main Objectives of the Reform of Resource Tax
1. Guiding Ideology
Fully implementing the guiding principles of the 18th National Congress of the Communist Party of China ("CPC") and the Third, Fourth and Fifth Plenary Sessions of the 18th CPC Central Committee, in accordance with the "Five in One" overall layout and "Four-Pronged Comprehensive" strategic layout, it is imperative to firmly establish and implement the development concepts of innovation, coordination, green, openness and sharing, fully promote the reform of resource tax, effectively give play to the regulating role of tax lever, facilitate the continuous and healthy development of the resource industry, and promote the adjustment of economic structure and transformation of development mode.
2. Fundamental Principles
The first is integration of fees with taxes. Efforts shall be made to resolve the current issues of overlapping of fees and taxes and interleaving of functions, properly incorporate the fees and funds such as the mineral resource compensation fees into resource tax, abolish all types of fees and funds established in violation of regulations or ultra vires, and further straighten out the relationship between fees and taxes.
The second is reasonable burden. By considering the practical circumstances of enterprises and their abilities to assume burden and learning from the fee and tax reform experiences for coal and other resources, taxation base and tax rate level for resource tax shall be reasonably determined, so as to increase flexibility for taxation and on the whole not to increase the tax burden of enterprises.
The third is proper devolution of authority. In view of the practical circumstances of our country, such as imbalanced distribution of resources and relatively large regional differences, on the premise that the order of the national unified market is not affected, the tax administration authority shall be properly devolved to local governments.
The fourth is progressive improvement. Based on the implementation of the reform of ad valorem taxation for coal, crude oil and natural gas, reform shall be fully implemented for other mineral resources. Conditions shall be created to gradually levy resource tax on natural resources such as water, forest, grassland, and mudflat.
3. Main Objectives
By way of fully implementing the integration of fees with taxes and the reform of ad valorem taxation, the relationship between resource tax and fees shall be straightened out, and a resource tax regime shall be established with fair norms, reasonable regulation and efficient collection, so as to effectively play its role of coordinating the revenue, regulating the economy, promoting the economical and intensive utilization of resources and protecting the ecological environment.
II. Main Contents of the Reform of Resource Tax
1. Enlargement of the Scope of Levy of Resource Tax
(1) Carry out the pilot program of water resource tax reform. In light of the wide scope involved in the extraction of water resources and their complicated circumstances, in order to ensure the smooth and orderly implementation of the reform, the pilot program of water resource tax reform shall be firstly carried out in Hebei Province. In carrying out the pilot program of water resource tax reform, Hebei Province shall adopt the mode of converting water resource fee to tax, include surface water and underground water in the scope of taxation, implement the volume-based taxation and properly increase the tax amount standards for water-intensive industry, off-plan usage of water and extraction of underground water in areas where groundwater is over-exploited, whilst the original level of burden for normal usage of water for production and living will remain unchanged.
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