According to China Business News, officials from State Administration of Taxation have stated that they expect a fuel tax to be imposed before the end of 2008.

A source from the Ministry of Transport said that it now appears that the fuel tax reform scheme is basically same as the plan released by the National Development and Reform Commission (NDRC).

According to information released on the NDRC website, the reform plan may include improving the refined oil pricing mechanism to cut the price of domestic refined oil; simultaneously canceling road maintenance fees, channel conservation fees, management fees for road transport, highway passenger and freight surcharges, management fees for waterway transport and some highway fee collecting stations; and implementing a fuel tax.

The source said that the fuel tax rate will be decided by how much the oil price is cut. The NDRC will establish a price mechanism to adjust the refined oil price, and offset increased oil expenditures caused by the fuel tax against cuts in the oil price.

For instance, gasoline 93, the most commonly used type of gas, now sells for 6.3 yuan (US$0.92) per liter. After adjustment, the price may fall by 0.7 yuan (US$0.1), in which case the fuel tax will rise by 0.7 yuan per liter.

In addition, the source told China Business News, during the discussions on the fuel reform scheme, there had been no discussion of expressway fees.

For more details, please read the complete story in Chinese:

http://www.china-cbn.com/s/n/000002/20081125/020000094030.shtml

(China.org.cn by Ma Yujia November 25, 2008)