Bloomberg reported that Chinese Ministry of Finance and State Administration of Taxation has raised the resources tax on six minerals effective from February 1st 2012 to help conserve its reserves.

Iron Ore
The tax on iron ore production was raised to 80% of a base rate, from 60%.
The base rate is between CNY 2 and CNY per tonne depending on the ore grade.

Tin
The resources tax on tin was increased to as much as CNY 20 per tonne
That’s equivalent to a 20 fold jump

Molybdenum
The tax was raised to as much as CNY 12 per tonne
That’s equivalent to CNY 4 per tonne

“The tax rate increases are the first for iron ore and molybdenum since January 1st 2006 and maybe longer for tin

China Taxation News said that the Chinese government also adjusted the resources tax on magnesite, pencil stone and boron rocks,.

But it is understood that the changes in the tax will have little impact on costs, though they will help boost tax revenue for local governments.

China is taking steps, including fiscal measures, to slow mineral production growth to conserve the environment. The government is also increasing tax rates to spur electricity saving in power- intensive industries after the country missed its energy- reduction target for the five years ended 2010.

(Sourced from Bloomberg)