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Wednesday, March 22, 2006

"China slaps a tax on chopsticks"

From, Wednesday, March 22, 2006:
China slaps a tax on chopsticks
Charges on goods unveiled in bid to preserve environment

BEIJING, China (Reuters) -- China will slap a tax on chopsticks and a range of goods ranging from yachts to petrol in a bid to save trees and protect the environment.

Plans to impose a 5 percent consumption tax on both disposable wooden chopsticks and wooden floor panels would help curb the plundering of timber resources and efforts to protect the environment, the Ministry of Finance said.

Disposable chopsticks used up 1.3 million cubic metes of timber each year, depleting the country's forests, the ministry said.

From April 1, China will make its biggest adjustments to consumption taxes in 12 years, with its newly stressed national goals of slashing energy consumption and stemming environmental degradation in mind.

The move was aimed at "promoting environmental protection and economizing on resources while better guiding the production and consumption of certain products," the ministry said on its Web site.

Among the most significant changes will be adjustments to car taxes, with levies poised to rise as high as 20 percent for highly polluting vehicles with larger engines.

China would also broaden the scope of oil products subject to consumption levies to include fuel oil, jet fuel and naphtha and lubricants, as the government leans more on pricing mechanisms to curb the country's rampant use of energy.

Adjustments were also made to level new consumption taxes on golf balls and equipment, yachts and luxury watches and to scrap charges on skin care and shampoo products, once seen as the privilege of the wealthy, but which have become commonplace as incomes have risen.

China's most common hard alcohol, known as baijiu, would be taxed at a flat level of 20 percent for the first time, it said.

The Finance Ministry did not say how the move would impact Chinese efforts to spur domestic consumption as a bigger driver of growth alongside exports and investment.

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