Finance Departments (Bureaus) and Local Tax Bureaus of all provinces, autonomous regions, municipalities directly under the central government, and cities separately listed in the national plan:

In accordance with the relevant provisions of the Interim Regulations on the Resource Tax of the People’s Republic of China and based on the actual situation of enterprises, and after careful consideration, we hereby notify you of the following issues concerning the adjustment of the resource tax policy for rock gold mines:

1. Adjust the tax rates for rock gold ore resources at each grade; specific standards are shown in the “Detailed List of Resource Tax Rates for Rock Gold Ore at Each Grade” (Attachment 1).

II. Adjust the scope of each grade for rock gold deposits. Enterprises (or gold mines) listed in the “Detailed Table of Resource Grade Classification for Rock Gold Deposits” (Appendix 2) shall determine their applicable tax rates according to their respective grades and the “Detailed Table of Resource Tax Rates for Each Grade of Rock Gold Deposits.” For enterprises (or gold mines) not included in the “Detailed Table of Resource Grade Classification for Rock Gold Deposits,” the applicable tax rates shall be determined by the people's governments of provinces, autonomous regions, and municipalities directly under the central government, based on their resource conditions and with reference to the tax rate standards for neighboring mines as specified in both the “Detailed Table of Resource Tax Rates for Each Grade of Rock Gold Deposits” and the “Detailed Table of Resource Grade Classification for Rock Gold Deposits.” The approved tax rates may fluctuate within a range of ±30% and must be filed with the Ministry of Finance and the State Administration of Taxation.

3. If the raw ore has already been subject to resource tax, and the tailings generated after beneficiation and metallurgical processing are reused, as long as the taxpayer can clearly reflect this in statistical and accounting records and can distinctly separate these tailings from the taxable raw ore in specific operations such as storage, no further resource tax shall be levied. If the tailings cannot be clearly distinguished from the raw ore, the resource tax shall continue to be levied based on the raw ore.

4. If the heap-leaching process is adopted, and the ore and waste rock (with a grade below 0.5 grams per ton) are leached separately, and taxpayers can clearly reflect this distinction in their statistical and accounting records and can also clearly separate the waste rock from the taxable raw ore in specific operations such as stacking, whether to impose resource tax on the waste rock shall be determined by the provincial people’s government.

V. This notice shall take effect as of May 1, 2006. The tax rates for various grades of rock gold ore specified in the “Detailed List of Resource Tax Rates” attached to the “Interim Implementation Rules for the Resource Tax of the People’s Republic of China” [(93) Cai Fa No. 43] and the “Resource Grade Table for Rock Gold Ore” included in the “Resource Grade Table for Several Major Mineral Varieties” shall be hereby repealed simultaneously.