This Wednesday, China revealed that tax and fee cuts in the country totaled 742.8 billion yuan during the first quarter of 2020. The cost cuts comprised of preferential tax and fee measures established by the country to promote economic development and containment of the pandemic.
An official with the State Taxation Administration in China Cai Zili revealed at a press conference that the total preferential tax and measures imposed by the country already cost 742.8 billion yuan for the first quarter of 2020. The policies that involved easements for the Chinese market players were to promote economic development and aid the containment of the pandemic within the country.
The remaining 424.6 billion yuan of taxes and fees were reduced after China imposed a larger scale of tax and fee cut mandates since 2019. During the first quarter of 2020, there was a total of 3.48 billion yuan in tax revenues after deducting export tax rebates. The values were 16.4 percent lower than that of 2019.
The tax revenue drop was expected to ease by the second quarter of 2020 as the resumption of life and production in the country accelerates. Cai added that since the pandemic shook the Chinese economy, the country imposed tax and fee relief measures to aid market entities, especially small and self-employed businesses, to cope with financial losses.
In other news, Reuters reported that China would release its quotas to export Sulphur fuel oil, amounting to 10 million tons for 2020. The quota was laid out after Beijing offered tax cuts in January to boost the local production of fuel. The said imposition allowed Chinese refiners to cope with the lowering demand for market products during the pandemic.
Sinopec Group would issue the oil quotas along with China's National Offshore Oil Company (CNOOC), Sinochem Group, and Zhejiang Petrochemical Corp (ZPC). However, the technicalities of the quotas were not publicized.
The tax waiver on exports of cleaner ship fuel was approved by the Chinese government in January. The imposition would allow Chinese refiners to increase their output quotas and enable the Chinese oil production market to be more competitive against suppliers in South Korea and Singapore.
The allotment provided that Sinopec would receive 4.29 million tons, CNPC with 2.95 million tons, CNOOC with 860,000 tons, and Sinochem with 900,000 tons. Two sources with ZPC claimed that refineries in China's top bunker port Zhoushan would also be allotted with one million tons. The refiner would then be required to export oil through state-run companies as its proxy.
