The
decline of world oil prices has renewed the debate over whether the Chinese government
should introduce a fuel oil tax, which was first proposed in 1994. The
falling prices offered an opportunity for the government to levy a tax, said Zha
Daojiong, director of the international strategic energy research center with
the Renmin University. However,
issues such as the tax rate, revenue use, and who should supervise the process
needed further study, Zha said. The
proposal to introduce a tax was never implemented as the government considered
it would impose a burden on those who consumed more oil, such as bus and taxi
drivers, Finance Minister Jin Renqing has said repeatedly since March last year.
Moreover,
with the world oil price hikes, the tax could also burden business, causing a
negative effect on the country's economy, Jin said. The
government has instead collected road maintenance fees from automobile users no
matter how much gasoline or diesel oil they use. China's
domestic oil prices did not include road construction and maintenance fees, an
official with China's National Development and Reform Commission (NDRC) said.
Despite soaring
crude oil prices, the NDRC, which regulates domestic prices for processed oil
according to changes on the world market, has kept prices relatively low, resulting
in losses for processors and consumer waste. With
China's oil consumption volume soaring, a fuel oil tax was pressing, Jia Xinguang,
leading analyzer with the China National Automotive Industry Consulting and Development
Corporation, said.
| 
