China to Impose Tax on Oil Byproducts

China to Impose Tax on Oil ByproductsChina to Impose Tax on Oil Byproducts

 China plans to impose consumption taxes on oil byproducts such as mixed aromatics, light cycle oil and bitumen blend, tightening regulations on a fuel import market worth millions of dollars. The proposed taxes of more than $145.01 per ton for the oil products could start in May, four sources with knowledge of the matter said, declining to be identified as they are not authorized to speak with media, Reuters reported. The taxes will effectively close a loophole often used by oil traders in China and will shut the door on nearly 20 million tons of imports of these products and improve sales of fuel produced locally, they said. Outside of China, the policy change will have a ripple effect across trading companies and refineries in Asia and Europe which have relied on the world's second-largest oil consumer as a key outlet for such products. "If taxes are imposed, I think this market will be dead," said a South Korean refining source that declined to be named.

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