Lou Jiwei, the Deputy Minister of Finance, addressed the 2006 China Industry Development Report Conference on November 12th, emphasizing that while current fuel tax rates are high, the Ministry of Finance has not yet planned to raise this tax. He explained that fuel prices are still not at a reasonable level, and thus increasing the tax now would be premature.
According to Lou, implementing a fuel tax could help reduce fuel consumption and promote energy conservation. However, he pointed out that it would not address the core issues of oil production and distribution. Therefore, setting a proper fuel price should come first before considering the collection of fuel tax. In the broader context of future tax system reforms, Lou stressed the importance of focusing on taxes related to factor income, such as personal income tax, resource tax, and property tax.
He also mentioned that in the development of mineral resources, new taxes on power and resource usage, along with special revenue streams, will be introduced to enhance the overall resource taxation framework. It is reported that relevant government departments are actively working on reforming the pricing mechanism for refined oil products. The proposal to "adjust and improve the resource tax and implement the fuel tax" has been included in the "11th Five-Year Plan" agenda.
Lou reiterated that the fuel tax can only be considered once fuel prices are properly set. When discussing the topic of inheritance tax, which has recently drawn significant public attention, Lou noted that its implementation requires clear and comprehensive personal information. Currently, China's personal income tax system faces challenges, and the collection of personal data remains incomplete. As a result, the introduction of an inheritance tax is not feasible at this time.
Earlier this year, officials from the Ministry of Finance had already stated that work on the inheritance tax had been put on hold and would not be prioritized in the near future. Globally, about two-thirds of countries and regions have implemented estate or inheritance taxes, but there is a growing trend toward their elimination in some places. (Reporter: Jia Nan)
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