The Ministry of Finance and the State Administration of Taxation recently issued a notice clarifying matters related to the reform of levying resource taxes on rare earths, tungsten, and molybdenum based on their value. The notice stipulates that light rare earths will be subject to different applicable tax rates depending on the region; among them, Inner Mongolia is... 11.5% Sichuan is 9.5% Shandong for 7.5% The applicable tax rate for the resource tax on medium- and heavy-rare-earth resources is... 27% The applicable tax rate for the tungsten resource tax is... 6.5% The applicable tax rate for the molybdenum resource tax is... 11%。

　　To further promote fee-to-tax reform and streamline the relationship between resource taxes and fees, 4 Moon 28 The State Council Executive Meeting held today decided that, starting from... 2015 Year 5 Moon 1 Starting from [date], the resource tax on rare earths, tungsten, and molybdenum will be changed from being levied based on quantity to being levied based on value, and the tax rate will be reasonably determined in accordance with the principle of not increasing the tax burden on enterprises. At the same time, further efforts will be made to streamline and standardize fees and charges: the fee rate for compensation for mineral resources related to rare earths, tungsten, and molybdenum will be reduced to zero; collection of the relevant price adjustment funds will be discontinued; and any fee or fund illegally established by local governments below the provincial level will be abolished.

　　Regarding the taxation method, the notice stipulates that the resource tax on rare earths, tungsten, and molybdenum will be changed from a quantity-based fixed-rate levy to a value-based rate-based levy. Taxable products of rare earths, tungsten, and molybdenum include both raw ore and concentrates processed from self-mined raw ore. If a taxpayer processes its mined raw ore into concentrates for sale, the resource tax shall be calculated and paid based on the sales revenue of the concentrates (excluding VAT) multiplied by the applicable tax rate. If a taxpayer mines and sells raw ore directly, the resource tax shall be calculated and paid by converting the sales revenue of the raw ore (excluding VAT) into the equivalent sales revenue of concentrates.

　　The notice also clarifies matters such as the sales volume of concentrate, the conversion between raw ore sales and concentrate sales, taxation on coexisting minerals and associated minerals, the tax payment stages, and the tax payment locations.

　　Meanwhile, in accordance with the State Council’s requirements for implementing the reform of resource taxes on rare earths, tungsten, and molybdenum, the Ministry of Finance, together with the National Development and Reform Commission, has decided to clean up and standardize the fees and funds related to rare earths, tungsten, and molybdenum, and has clarified relevant matters. All provinces, autonomous regions, and municipalities are required to comprehensively clean up and standardize fee and fund projects introduced locally that pertain to rare earths, tungsten, and molybdenum. Any fee and fund projects that violate regulations governing the approval and management of administrative and public service charges and government funds, or that have been instituted beyond authorized powers, must be canceled without exception. After the cleanup of fees and funds related to rare earths, tungsten, and molybdenum, the funds necessary for the relevant departments to perform their regular duties will be secured through general public budgets allocated by both central and local governments. All regions and relevant departments must strictly enforce the provisions of this notice. They must not, under any pretext, delay or refuse to implement the fees and funds that have been publicly announced as canceled or suspended, nor may they continue collecting such fees under other guises or in disguised forms.