Chinese Ministries Considering Higher Taxes for REE Producers

China Daily reported that according to an anonymous industry source, several ministries in China are mulling heavier taxes on rare earth elements (REE) producers. If such taxes are put in place, REE prices will likely rise.

As quoted in the market news:

Taxes would be imposed based on the value of the minerals, rather than on volume as is the case at present. That shift will mean higher prices at the producer level, which the government hopes will reflect the scarcity of these resources and the environmental costs of their extraction.

Higher prices will alter the supply-demand balance, undercut the smuggling trade and reduce high inventories of rare earths overseas, said the expert.

Other steps will also be taken to better manage the rare earth industry, the source said. For example, environmental compliance certificates are likely to be required for exports.

Click here to read the full China Daily report.