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China to raise tax on oil products but cut prices

Staff writer |
China said that it would raise the consumption tax on a range of oil products for the third time in less than two months.

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At the same time, the state economic planner said it would cut the official retail prices on gasoline and diesel, adding that the two moves effectively result in a net reduction of domestic oil prices.

The moves are aimed at promoting energy conservation and cutting pollution, the Ministry of Finance said in statements on its website.

China would raise the consumption tax on gasoline, lubricants and naphtha by 0.12 yuan (about $0.02) a liter to 1.52 yuan, while the tax on diesel, jet fuel and fuel oil would rise by 0.1 yuan a liter to 1.2 yuan, effective Tuesday, the finance ministry said.

The ministry said the additional tax revenue will be used to clean up the air and water, and support the country's alternative energy industry.

Also effective Tuesday, the National Development and Reform Commission said it would cut the retail price of gasoline and diesel by 0.13 yuan and 0.20 yuan a liter, respectively.

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