Coal prices rise too fast and resource tax reform becomes a phantom

Recently, people have paid considerable attention to the reform of the coal resource tax. The main reason is that the Central Government’s proposal for formulating the twelfth five-year plan for national economic and social development stated that it will continue to promote tax reform and comprehensive reform of resources. Taxes, resource tax reforms that have gradually faded from people's attention have once again reached the public.

Ren Haoning, a researcher in the energy industry at China Investment Advisors, pointed out that at the beginning of this year, the resource tax reform had been identified as one of the key tasks for China's fiscal and taxation reforms this year, but it was not until June that the relevant government departments of the country officially launched the pilot work on resource tax reform. The pilot work was conducted in the Xinjiang region. The initial plan was to carry out reforms of the resource tax reforms for petroleum, natural gas and coal in the Xinjiang region. At the time of final implementation, the coal did not enter the experimental scope of the resource tax reform. Since then, there has been no news of resource tax reforms, and the forecast of resource tax reforms by the public will be fully rolled out in the second half of this year and it seems to have become a mirror.

We believe that the possibility of introducing resource tax reform within the coal industry this year is relatively small. First of all, the above-mentioned documents are recommendations for the "Twelfth Five-Year Plan", and the official roll-out of the "Twelfth Five-Year Plan" construction work should be after the "**" next year; secondly, the current domestic economic situation is not suitable. The introduction of resource tax, domestic consumer price index in September has reached a new high during the year, and everyone has basically reached a consensus on the consumer price index in October exceeded 4%, in the face of huge inflationary pressure, The possibility of promoting reform of the resource tax is minimal; finally, the resource tax reform involves a very wide range of areas. Even if the resource tax is to be introduced, it will be a process of gradual promotion. It may not be a sudden nationwide levy and this year will remain. The time is not enough to complete this reform.

Zhang Yanlin, research director of China Investment Consulting Co., Ltd. pointed out that although China’s current coal resource tax is still calculated on a case-by-volume basis and the amount of the levy is very small, most of the coal-producing regions in China are levied with fees similar to resource management fees. Implementation of resource tax reforms will replace these types of charges, so the cost pressures faced by coal producers are not expected to be as great. However, due to the strong ability of domestic coal companies to transfer their rising costs, resource tax reform will become a driving factor for companies to increase coal prices.

The “2010-2015 China Coal Industry Investment Analysis and Prospect Forecast Report” released by China Investment Advisors pointed out that the implementation of the resource tax reform in the coal industry must meet certain conditions. At present, domestic coal prices have risen too fast and are in coal companies. At the point of signing the next year's coal supply agreement, power companies will inevitably increase the cost pressure on power companies and affect the nation’s energy security.