/* Style Definitions */
mso-padding-alt:0in 5.4pt 0in 5.4pt;
font-family:”Times New Roman”;
The Chinese Government has raised its tax on iron ore, tin, and other resources in an attempt to conserve mineral reserves.
The tax rate for iron ore has been raised from 60 per cent to 80 per cent, and tin has risen to 12-20 yuan per tonne from 0.6-1 yuan, according to the official China Taxation News.
Similar hikes also extend to molybdenum, magnesium, talc, and boron, and will be effective as of February 1 this year.
China is the world’s largest buyer of iron ore and according to Bloomberg the country is taking steps to slow mining to protect the environment.
It is also raising costs in an effort to encourage electricity saving in power-intensive industries.
Analysts told Bloomberg the rise would only see a short term impact on producers as they could pass on additional costs to customers.
They said because of its high profits the country’s iron ore industry would not be severely hit, but local governments would see a boost in tax revenue.
Fat Prophets analyst David Lennox told The Malaysia Star global iron ore producers such as BHP Billiton, Rio Tinto, and Vale were unlikely to be impacted from the change.