• 3 minutes e-car sales collapse
  • 6 minutes America Is Exceptional in Its Political Divide
  • 11 minutes Perovskites, a ‘dirt cheap’ alternative to silicon, just got a lot more efficient
  • 5 hours GREEN NEW DEAL = BLIZZARD OF LIES
  • 7 days Does Toyota Know Something That We Don’t?
  • 13 hours America should go after China but it should be done in a wise way.
  • 6 days World could get rid of Putin and Russia but nobody is bold enough
  • 8 days China is using Chinese Names of Cities on their Border with Russia.
  • 10 days Russian Officials Voice Concerns About Chinese-Funded Rail Line
  • 10 days OPINION: Putin’s Genocidal Myth A scholarly treatise on the thousands of years of Ukrainian history. RCW
  • 10 days CHINA Economy IMPLODING - Fastest Price Fall in 14 Years & Stock Market Crashes to 5 Year Low
  • 9 days CHINA Economy Disaster - Employee Shortages, Retirement Age, Birth Rate & Ageing Population
  • 4 hours How Far Have We Really Gotten With Alternative Energy
  • 9 days Putin and Xi Bet on the Global South
  • 10 days "(Another) Putin Critic 'Falls' Out Of Window, Dies"
  • 10 days United States LNG Exports Reach Third Place
  • 10 days Biden's $2 trillion Plan for Insfrastructure and Jobs
Tsvetana Paraskova

Tsvetana Paraskova

Tsvetana is a writer for Oilprice.com with over a decade of experience writing for news outlets such as iNVEZZ and SeeNews. 

More Info

Premium Content

China Looks To Close Teapots’ Oil Tax Loopholes

China is tightening government control over the collection of the oil consumption tax in order to eliminate the loopholes that independent refiners—known as teapots—have been exploiting to beef up their profitability.

The stricter oil tax collection move is closely watched by oil analysts because it could hurt teapots’ profit margins and ultimately affect Chinese crude oil imports and oil product exports, S&P Global Platts’ Oceana Zhou wrote in an analysis on Thursday.

As of March 1, China is using a new tax reporting system that tightens transaction monitoring, and it is trying to make the tax collection more effective by eliminating the role of the provincial governments in the tax collection.

Independent refiners have so far enjoyed the protection of their respective local governments that have been collecting the tax revenues from the teapots, but all tax revenue has gone to the central government. Provinces where independent refiners are based have not fully collected the oil consumption taxes and have given tax breaks to the teapots, to ensure local employment and continuous income.

“And unlike their state-owned peers, which pay tax revenues to the central government, local teapots’ fiscal contributions stay within their locality. As such, teapots have received strong support in the form of tax breaks and cheap access to land. Local authorities have even offered teapots refunds on the consumption tax—on blending components for gasoline—or have not been collecting it from the teapots at all,” Michal Meidan of Energy Aspects wrote in a paper for the Oxford Institute for Energy Studies last year. 

Now, together with an updated tax reporting system, China’s central government is said to be considering sharing the tax revenue with the provincial governments, Platts’ Zhou says. This would encourage the local governments to collect the oil consumption tax in full and in line with regulations in order to boost their tax revenues.

By Tsvetana Paraskova for Oilprice.com

More Top Reads From Oilprice.com:


Download The Free Oilprice App Today

Back to homepage





Leave a comment

Leave a comment




EXXON Mobil -0.35
Open57.81 Trading Vol.6.96M Previous Vol.241.7B
BUY 57.15
Sell 57.00
Oilprice - The No. 1 Source for Oil & Energy News