Draft resource tax law gets 2nd reading at China's top legislature

A new draft of the resource tax law was submitted Thursday to the ongoing bimonthly session of the National People's Congress (NPC) Standing Committee for a second reading.

The bill stipulates the scope of taxation with a table of tax items and rates, and allows the State Council to collect water resources tax on a trial basis on organizations and individuals that draw surface water or ground water.

The draft also introduces a rule reducing resource taxes on the drilling of heavy oil and high pour-point oil as well as tertiary oil recovery.

In order to implement the principle of law-based taxation and standardize the resource tax system, it is necessary to enact the resource tax law, said Zhou Guangquan, vice chairman of the NPC Constitution and Law Committee, adding that the draft is quite mature after deliberation and revision.

China has enacted dedicated laws for eight of its 18 categories of taxes. Minister of Finance Liu Kun said earlier that legislation on the remaining categories will be accelerated.

The first reading of the draft resource tax law was conducted in December last year.