The Ministry of Finance and the State Administration of Taxation recently issued a notice to clarify the relevant matters relating to the ad valorem reform of rare earth, tungsten and molybdenum resource taxes. The notice stipulated that light rare earths should be subject to different applicable tax rates according to regions, of which 11.5% in Inner Mongolia, 9.5% in Sichuan, and 7.5% in Shandong. The applicable tax rate for the medium- and heavy-earth resource tax is 27%. The applicable tax rate for tungsten resource tax is 6.5%. The tax rate for molybdenum resource tax is 11%.

In order to further promote clean-up taxation and rationalize resource taxation, the State Council executive meeting held on April 28 decided that from May 1, 2015, the resource tax for rare earth, tungsten, and molybdenum will be changed The ad valorem will be collected and the tax rate shall be reasonably determined in accordance with the principle of not increasing the tax burden on the company. At the same time, to further clean up and regulate fees, the mineral resources compensation rate for rare earth, tungsten and molybdenum will be reduced to zero, relevant price adjustments will cease to be imposed, and relevant fees imposed by local governments under the provincial government will be banned.

With regard to the method of calculation, the notice stipulated that the resource tax for rare earth, tungsten, and molybdenum should be changed from fixed amount quotas to fixed rate quotas. Rare earth, tungsten, molybdenum taxable products include raw ores and concentrates processed from raw ore. If the taxpayer processes the raw ore it mines for sale as a concentrate, it shall calculate and pay the resource tax on the sales of concentrate (excluding VAT) and the applicable tax rate. If the taxpayer mines and sells the raw ore, it will convert the original ore sales (excluding VAT) into a calculated resource tax for concentrate sales.

The notice also clarified the contents of concentrate sales, conversion of raw ore sales and sales of concentrates, taxation of symbiotic ore, associated tax, taxation links, and tax payment location.

At the same time, the Ministry of Finance together with the National Development and Reform Commission, in accordance with the requirements of the State Council's implementation of the resource tax reforms for rare earth, tungsten, and molybdenum, decided to clean up charges involving rare earth, tungsten, and molybdenum, and clarified relevant issues. It is required that all provinces, autonomous regions, and municipalities directly under the Central Government should comprehensively clean up and standardize the fees, charges, and charges imposed on the rare earth, tungsten, and molybdenum in the region. All violations of administrative fees and government regulations shall be regulated. cancel. After clearing up the charges related to rare earth, tungsten and molybdenum, the funds required by the relevant departments to perform their normal job duties shall be guaranteed by the central and local governments through general public budget arrangements. All regions and all relevant departments shall strictly implement the provisions of this Circular, and shall refrain from delaying or refusing implementation on any grounds, and shall not continue to charge fees by disguising other names.