Two tax adjustment drive market deployment of rare earth resources

Recently, China's rare earth fiscal policies to make significant adjustments, first abolish export tariffs on rare earths, followed by lower rare earth resources tax. Ministry of Finance recently issued a notice, to adjust export tariffs on some products, which contains the rare earths this one, and the adjustment effective from May 1, 2015. April 28 the State Council executive meeting, the implementation of rare earth, tungsten, molybdenum resource tax reform, promoting rationalize resources tax relationship.

August 7, 2014, WTO finds that Chinese export restrictions on rare earths and other products violate WTO rules, that China's export duties and quotas for its failure to protect the environment or resource grounds justified. In January 2015, the Commerce Department announced the cancellation of rare earth export quota system.

After the export duties and export quotas, resource tax reform could increase resource tax rate, reference to other mineral resources tax levied, and included tax range. If, after considering the liberalization of export tariffs, rare earth prices can back up the possibility of a higher "ad valorem" option calls.

Although China's rare earth WTO lawsuit lost, we can not continue to use tariffs to protect rare earth resources, but WTO litigation since 2011, our country has accelerated the pace of implementation of the integration of the whole industrial chain of rare earth.

Since the 2011 establishment of the Office of Rare Earth, our country has formed a rare office led the joint Ministry of Land Resources, the National Development and Reform Commission, Ministry of Commerce, General Administration of Customs and other six departments coordination mechanism. On the one hand, development of rare earth resources in a variety of offenses continued to maintain high-pressure situation, especially in southern areas of rare earth, after several rounds of crackdown, "black rare earth" substantially reduced, mining order effectively managed; on the other hand, accelerate the industry and mergers and reorganizations, Shoulong scattered mining permits in the market, the formation of the North earth, Ganzhou Rare Earth Rare Earth Group of six major focus of the main producing areas of different rare earth resources exploitation unified unified management. In addition, rare earth functional components to be integrated into the country's new materials industry development strategy to encourage downstream enterprises to actively carry out applied research, trying to cultivate a number of rare earth application of enterprise international competitiveness. From the strict management to market liberalization, experts point out that China's current management of rare earth resources, has achieved initial success, the rare earth resource tax can be appropriately adjusted, to ensure the supply of rare earth resources and services in the upgrading of China's economic transformation, which is conducive to promoting China RE downstream enterprises to reduce costs, increase R & D investment, promote the whole earth industry chain towards high-end level.

The industry believes that the rare earth resources end double reforms to strengthen management on the basis of norms to regulate the allocation of resources by market forces, which allows Chinese rare earth and downstream industries at the same time towards the end of more internationally competitive. However, we must clearly recognize that the current separation of rare earth smelting industry of serious excess capacity, upstream and downstream industries in the high-end products still have strong international competitiveness, in terms of development of new features rare behind the international frontier. On the whole chain of production and research of rare earth industry, the economic strength of China's rare earth field is still relatively low level. The liberalization of exports of rare earth and rare earth resources tax adjustment is able to usher in a new development opportunities for China's rare earth industry still depends on time and practice to verify.


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