Wednesday, November 21, 2007

China publishes consumption taxrates for various items

BIZCHINA / In the Press

 China publishes consumption taxrates for various items
Updated: 2006-03-22 09:38

China on Wednesday released a list of consumer goods to be taxed at
varied consumption tax rates from April 1.

The Ministry of Finance and the General Administration of Taxation have
decided to impose different tax rates on disposable wooden chopsticks,
wooden floor panels, yachts, luxury watches and more oil-based products.

China will collect a 5 percent consumption tax on disposable wooden
chopsticks in a bid to discourage their use as they are a waste of timber
resources, said the ministry.
China will also impose a 5 percent tax on wooden floor panels to
discourage the consumption of timber resources.  It will also introduce a
10 percent tax on yachts, golf balls and golf clubs, and a 20 percent tax
on luxury watches, it said.
China will collect a consumption tax on naphtha, solvent, lubricant at a
rate of 0.2 yuan per liter, and 0.1 yuan per liter
for aviation fuel oil, said the ministry.
The ministry said the government will collect only 30 percent of the tax
on naphtha and solvent in order to lessen the impact on the industry
sector. It will also not collect the tax on aviation fuel for the time

The ministry introduced new tax rates for automobiles, including tax
rates ranging from 3 percent to 20 percent for automobiles according to
the size of engines.
The tax rate for automobiles with engine size at or below 1.5 liters will
be 3 percent, and 20 percent for automobiles at 4.0
liter or above.
The tax rate for light and medium-sized business passenger vehicles will
be 5 percent, according to the ministry.

The tax rate for motorcycles whose engine size is at or below 250 ml at 3
percent and 10 percent for those above 250 ml.

The tax rate for auto tyre will lowered to 3 percent from its current
rate of 10 percent.

The tax rates for distilled spirits will be 20 percent, reunifying the
varied tax rates for liquor made from grain and
those made from potatoes.

The ministry said it will scrap the consumption tax on skin care and
shampoo products as of April 1.

The Ministry of Finance said the plan has been approved by the Chinese
Government and was designed to control and regulate energy consumption,
help protect the environment by reducing consumption of timber resources,
and narrow the gap between the poor and the rich by collecting a
consumption tax on the luxury items.

(For more biz stories, please visit Industry Updates)

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