Volume 4, Issue 2, June 2019, Page: 54-64
Researches on Optimal Tax Rate and Its Effect of Copper Mine Resource Tax in China
Wenting Zhao, Department of Accounting, Guangzhou College of Commerce, Guangzhou, China
Minyi Guan, Department of Accounting, Guangzhou College of Commerce, Guangzhou, China
Received: Mar. 31, 2019;       Accepted: Apr. 28, 2019;       Published: Jun. 11, 2019
DOI: 10.11648/j.ajere.20190402.12      View  722      Downloads  122
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.
Ad Valorem Duty, CGE Model, Copper Resource Tax, Macroeconomic Impact, Optimal Tax Rate
To cite this article
Wenting Zhao, Minyi Guan, Researches on Optimal Tax Rate and Its Effect of Copper Mine Resource Tax in China, American Journal of Environmental and Resource Economics. Vol. 4, No. 2, 2019, pp. 54-64. doi: 10.11648/j.ajere.20190402.12
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This article is an open access article distributed under the Creative Commons Attribution License (http://creativecommons.org/licenses/by/4.0/) which permits unrestricted use, distribution, and reproduction in any medium, provided the original work is properly cited.
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