China may increase tax on natural resources

China may raise a tax on natural resources and also collect duty on the use of water by companies to enhance resource conservation and environment protection, the Ministry of Finance said yesterday.

The government will change the mode of tax on coal from a volume-based levy to a tax on the sales price, which will increase the burden on mining companies. Taxes on other minerals may also be raised to reflect their scarcity and curb excess demand.

China will also study a tax on the consumption of water "at an appropriate time" to promote environment protection.

The ministry also said it will look at imposing a consumption tax on certain products which use huge amounts of resources and pollute the environment during production.

The move is part of China's efforts to deepen the reform of the resource tax and was in accordance with building a "beautiful China" to push ahead progress made in ecological protection, Finance Minister Xie Xuren said.

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