Researches on Optimal Tax Rate and Its Effect of Copper Mine Resource Tax in China

Wenting Zhao; Minyi Guan

doi:doi:10.11648/j.ajere.20190402.12

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Researches on Optimal Tax Rate and Its Effect of Copper Mine Resource Tax in China

Wenting Zhao, Minyi Guan

Received: 31 March 2019 Accepted: 28 April 2019 Published: 11 June 2019

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Abstract

As an important natural resource, mineral resources are indispensable necessities for human’s social existence and economic development. As China’s industrialization process continues to gradually increase, conflicts about resource constraint and ecological pressure resulting from economic and social development are increasingly evident. Key problems of how to guarantee the security of national mineral resources supply, ease the contradiction of resource constraint, and reduce ecological pressure are significant current challenges in China. The Chinese government has successively implemented new types of resource taxes including "ad valorem duty" and "free fee and regulate tax" reform for oil, natural gas, and coal resources in an attempt to adjust differential income needs and protect resources. Given these efforts, there have also been strategies to reform policies for the use and taxation of non-ferrous metal resources. In 2016, the Chinese Ministry of Finance and the State Council jointly issued a government document to comprehensively promote the reform of resource tax policy. This document also set the standards of tax rate for seven metal minerals. Copper is one of the regulated minerals, and the tax rate range of copper mine was set as 2% to 8%, dependent on the conditions of different provinces. We constructed a resource computable general equilibrium (CGE) model to investigate the optimal tax rate of copper resource under ad valorem duty in China. The results showed that the best tax rate is 4%. Based on this optimal rate, a dynamic CGE model was built to analyze and dynamically forecast the macroeconomic impact of different tax rates, providing insight into the best strategy to enable cost control for enterprises and efficient and effective policymaking by the government. Because comprehensive resource tax reform remains in the exploratory stage, the results of this study will provide a reference for the future optimization of the copper mine resource tax rate.

DOI	10.11648/j.ajere.20190402.12
Published in	American Journal of Environmental and Resource Economics (Volume 4, Issue 2, June 2019)
Page(s)	54-64
Creative Commons	This is an Open Access article, distributed under the terms of the Creative Commons Attribution 4.0 International License (http://creativecommons.org/licenses/by/4.0/), which permits unrestricted use, distribution and reproduction in any medium or format, provided the original work is properly cited.
Copyright	Copyright © The Author(s), 2024. Published by Science Publishing Group

Keywords

Ad Valorem Duty, CGE Model, Copper Resource Tax, Macroeconomic Impact, Optimal Tax Rate

References

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APA Style

Wenting Zhao, Minyi Guan. (2019). Researches on Optimal Tax Rate and Its Effect of Copper Mine Resource Tax in China. American Journal of Environmental and Resource Economics, 4(2), 54-64. https://doi.org/10.11648/j.ajere.20190402.12

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ACS Style

Wenting Zhao; Minyi Guan. Researches on Optimal Tax Rate and Its Effect of Copper Mine Resource Tax in China. Am. J. Environ. Resour. Econ. 2019, 4(2), 54-64. doi: 10.11648/j.ajere.20190402.12

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AMA Style

Wenting Zhao, Minyi Guan. Researches on Optimal Tax Rate and Its Effect of Copper Mine Resource Tax in China. Am J Environ Resour Econ. 2019;4(2):54-64. doi: 10.11648/j.ajere.20190402.12

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@article{10.11648/j.ajere.20190402.12,
  author = {Wenting Zhao and Minyi Guan},
  title = {Researches on Optimal Tax Rate and Its Effect of Copper Mine Resource Tax in China},
  journal = {American Journal of Environmental and Resource Economics},
  volume = {4},
  number = {2},
  pages = {54-64},
  doi = {10.11648/j.ajere.20190402.12},
  url = {https://doi.org/10.11648/j.ajere.20190402.12},
  eprint = {https://article.sciencepublishinggroup.com/pdf/10.11648.j.ajere.20190402.12},
  abstract = {As an important natural resource, mineral resources are indispensable necessities for human’s social existence and economic development. As China’s industrialization process continues to gradually increase, conflicts about resource constraint and ecological pressure resulting from economic and social development are increasingly evident. Key problems of how to guarantee the security of national mineral resources supply, ease the contradiction of resource constraint, and reduce ecological pressure are significant current challenges in China. The Chinese government has successively implemented new types of resource taxes including "ad valorem duty" and "free fee and regulate tax" reform for oil, natural gas, and coal resources in an attempt to adjust differential income needs and protect resources. Given these efforts, there have also been strategies to reform policies for the use and taxation of non-ferrous metal resources. In 2016, the Chinese Ministry of Finance and the State Council jointly issued a government document to comprehensively promote the reform of resource tax policy. This document also set the standards of tax rate for seven metal minerals. Copper is one of the regulated minerals, and the tax rate range of copper mine was set as 2% to 8%, dependent on the conditions of different provinces. We constructed a resource computable general equilibrium (CGE) model to investigate the optimal tax rate of copper resource under ad valorem duty in China. The results showed that the best tax rate is 4%. Based on this optimal rate, a dynamic CGE model was built to analyze and dynamically forecast the macroeconomic impact of different tax rates, providing insight into the best strategy to enable cost control for enterprises and efficient and effective policymaking by the government. Because comprehensive resource tax reform remains in the exploratory stage, the results of this study will provide a reference for the future optimization of the copper mine resource tax rate.},
 year = {2019}
}

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TY  - JOUR
T1  - Researches on Optimal Tax Rate and Its Effect of Copper Mine Resource Tax in China
AU  - Wenting Zhao
AU  - Minyi Guan
Y1  - 2019/06/11
PY  - 2019
N1  - https://doi.org/10.11648/j.ajere.20190402.12
DO  - 10.11648/j.ajere.20190402.12
T2  - American Journal of Environmental and Resource Economics
JF  - American Journal of Environmental and Resource Economics
JO  - American Journal of Environmental and Resource Economics
SP  - 54
EP  - 64
PB  - Science Publishing Group
SN  - 2578-787X
UR  - https://doi.org/10.11648/j.ajere.20190402.12
AB  - As an important natural resource, mineral resources are indispensable necessities for human’s social existence and economic development. As China’s industrialization process continues to gradually increase, conflicts about resource constraint and ecological pressure resulting from economic and social development are increasingly evident. Key problems of how to guarantee the security of national mineral resources supply, ease the contradiction of resource constraint, and reduce ecological pressure are significant current challenges in China. The Chinese government has successively implemented new types of resource taxes including "ad valorem duty" and "free fee and regulate tax" reform for oil, natural gas, and coal resources in an attempt to adjust differential income needs and protect resources. Given these efforts, there have also been strategies to reform policies for the use and taxation of non-ferrous metal resources. In 2016, the Chinese Ministry of Finance and the State Council jointly issued a government document to comprehensively promote the reform of resource tax policy. This document also set the standards of tax rate for seven metal minerals. Copper is one of the regulated minerals, and the tax rate range of copper mine was set as 2% to 8%, dependent on the conditions of different provinces. We constructed a resource computable general equilibrium (CGE) model to investigate the optimal tax rate of copper resource under ad valorem duty in China. The results showed that the best tax rate is 4%. Based on this optimal rate, a dynamic CGE model was built to analyze and dynamically forecast the macroeconomic impact of different tax rates, providing insight into the best strategy to enable cost control for enterprises and efficient and effective policymaking by the government. Because comprehensive resource tax reform remains in the exploratory stage, the results of this study will provide a reference for the future optimization of the copper mine resource tax rate.
VL  - 4
IS  - 2
ER  -

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Author Information

Wenting Zhao

Department of Accounting, Guangzhou College of Commerce, Guangzhou, China
Minyi Guan

Department of Accounting, Guangzhou College of Commerce, Guangzhou, China

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APA Style

Wenting Zhao, Minyi Guan. (2019). Researches on Optimal Tax Rate and Its Effect of Copper Mine Resource Tax in China. American Journal of Environmental and Resource Economics, 4(2), 54-64. https://doi.org/10.11648/j.ajere.20190402.12

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ACS Style

Wenting Zhao; Minyi Guan. Researches on Optimal Tax Rate and Its Effect of Copper Mine Resource Tax in China. Am. J. Environ. Resour. Econ. 2019, 4(2), 54-64. doi: 10.11648/j.ajere.20190402.12

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AMA Style

Wenting Zhao, Minyi Guan. Researches on Optimal Tax Rate and Its Effect of Copper Mine Resource Tax in China. Am J Environ Resour Econ. 2019;4(2):54-64. doi: 10.11648/j.ajere.20190402.12

Copy | Download

@article{10.11648/j.ajere.20190402.12,
  author = {Wenting Zhao and Minyi Guan},
  title = {Researches on Optimal Tax Rate and Its Effect of Copper Mine Resource Tax in China},
  journal = {American Journal of Environmental and Resource Economics},
  volume = {4},
  number = {2},
  pages = {54-64},
  doi = {10.11648/j.ajere.20190402.12},
  url = {https://doi.org/10.11648/j.ajere.20190402.12},
  eprint = {https://article.sciencepublishinggroup.com/pdf/10.11648.j.ajere.20190402.12},
  abstract = {As an important natural resource, mineral resources are indispensable necessities for human’s social existence and economic development. As China’s industrialization process continues to gradually increase, conflicts about resource constraint and ecological pressure resulting from economic and social development are increasingly evident. Key problems of how to guarantee the security of national mineral resources supply, ease the contradiction of resource constraint, and reduce ecological pressure are significant current challenges in China. The Chinese government has successively implemented new types of resource taxes including "ad valorem duty" and "free fee and regulate tax" reform for oil, natural gas, and coal resources in an attempt to adjust differential income needs and protect resources. Given these efforts, there have also been strategies to reform policies for the use and taxation of non-ferrous metal resources. In 2016, the Chinese Ministry of Finance and the State Council jointly issued a government document to comprehensively promote the reform of resource tax policy. This document also set the standards of tax rate for seven metal minerals. Copper is one of the regulated minerals, and the tax rate range of copper mine was set as 2% to 8%, dependent on the conditions of different provinces. We constructed a resource computable general equilibrium (CGE) model to investigate the optimal tax rate of copper resource under ad valorem duty in China. The results showed that the best tax rate is 4%. Based on this optimal rate, a dynamic CGE model was built to analyze and dynamically forecast the macroeconomic impact of different tax rates, providing insight into the best strategy to enable cost control for enterprises and efficient and effective policymaking by the government. Because comprehensive resource tax reform remains in the exploratory stage, the results of this study will provide a reference for the future optimization of the copper mine resource tax rate.},
 year = {2019}
}

Copy | Download

TY  - JOUR
T1  - Researches on Optimal Tax Rate and Its Effect of Copper Mine Resource Tax in China
AU  - Wenting Zhao
AU  - Minyi Guan
Y1  - 2019/06/11
PY  - 2019
N1  - https://doi.org/10.11648/j.ajere.20190402.12
DO  - 10.11648/j.ajere.20190402.12
T2  - American Journal of Environmental and Resource Economics
JF  - American Journal of Environmental and Resource Economics
JO  - American Journal of Environmental and Resource Economics
SP  - 54
EP  - 64
PB  - Science Publishing Group
SN  - 2578-787X
UR  - https://doi.org/10.11648/j.ajere.20190402.12
AB  - As an important natural resource, mineral resources are indispensable necessities for human’s social existence and economic development. As China’s industrialization process continues to gradually increase, conflicts about resource constraint and ecological pressure resulting from economic and social development are increasingly evident. Key problems of how to guarantee the security of national mineral resources supply, ease the contradiction of resource constraint, and reduce ecological pressure are significant current challenges in China. The Chinese government has successively implemented new types of resource taxes including "ad valorem duty" and "free fee and regulate tax" reform for oil, natural gas, and coal resources in an attempt to adjust differential income needs and protect resources. Given these efforts, there have also been strategies to reform policies for the use and taxation of non-ferrous metal resources. In 2016, the Chinese Ministry of Finance and the State Council jointly issued a government document to comprehensively promote the reform of resource tax policy. This document also set the standards of tax rate for seven metal minerals. Copper is one of the regulated minerals, and the tax rate range of copper mine was set as 2% to 8%, dependent on the conditions of different provinces. We constructed a resource computable general equilibrium (CGE) model to investigate the optimal tax rate of copper resource under ad valorem duty in China. The results showed that the best tax rate is 4%. Based on this optimal rate, a dynamic CGE model was built to analyze and dynamically forecast the macroeconomic impact of different tax rates, providing insight into the best strategy to enable cost control for enterprises and efficient and effective policymaking by the government. Because comprehensive resource tax reform remains in the exploratory stage, the results of this study will provide a reference for the future optimization of the copper mine resource tax rate.
VL  - 4
IS  - 2
ER  -

Copy | Download