ANNOUNCEMENT 22 Dec 2017
December 22nd, 2017 - The Chinese government published an update to its policy which guarantees domestic importers a certain price on natural gas.
NUMBER OF INTERVENTIONS
PRC Ministry of Finance, December 22nd, 2017. (财关税〔2017〕41号)
On December 22nd, 2017, the Chinese State Administration of Taxation reduced the target domestic sales price for imported natural gas. To incentivise gas imports, the Chinese government rebates the VAT on imported natural gas when the import price exceeds the desired domestic price.
By reducing the target price, imports are more incentivised, hence the green classification of this intervention.
Through its decree, the Chinese government altered the sales price of natural gas as follows:
The measure is effective retroactively for the relevant periods. Excess VAT paid on prior imports will be credited accordingly.
In addition to the above, the Chinese natural gas rebate policy simultaneously consitutes a discriminatory treatment of unknown users of the natural gas imported through the scheme, as imported LNG benefitted from the rebate.