China O&G/Coal: According to news reports, China may levy resource tax of up to 10% on oil & gas. China had proposed a nationwide resource tax to raise funds to develop the poorer western regions, which are rich in oil, gas & coal reserves & has introduced a trial tax of 5% in Xinjiang & other western provinces. Coal will still be taxed by volume instead of price levels but the tax may be raised to Rmb0.3-0.8/ton from Rmb0.3-0.5/ton under the amended rules.
No details on the timeframe for nationwide implementation have been given due to inflation concerns. The potential losers of this resource tax would include the O&G & mining companies such as RH Petrogas (Fuyu 1 oil concession) & Abterra (Shanxi coal mines),
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