Tax System To Promote The Rational Development Of China's Oil Resources

Petroleum resource is an important material foundation of social development and the important guarantee for national security. At present China is at a crucial period of modernization, however, in recent years the international oil prices maintain a high level, which affects the development of the domestic economy directly and also shows the importance of safe supply of petroleum resource.The macro situation on petroleum resource of China is generally good, but with the attenuation of mature petroleum reserves and the shortage of discovery on large complete petroleum resource regions, the growth of our petroleum output based on the domestic reserves is slowing down and even decreased slightly. The foreign trade dependence degree also keeps rising, and all of these alarm us to accelerate the development of domestic petroleum resource. As a student on public finance major, it is meaningful to research the topic about how to promote the rational exploitation of our domestic petroleum resource.Internationally, major oil-rich countries have already formed a petroleum resource tax system including royalties and mining rents. And based on different domestic situation, these countries also set other different tax types. Generally speaking, the foreign tax preference policies on encouraging domestic petroleum resource exploration are relatively sound, and their tax system is also designed to take into account the changes of international oil prices. The whole tax system is more mature and complete, which deserves studying and learning from it.Our present tax system on petroleum resource includes universal VAT, income tax, and other specialized taxes such as resource tax, mineral resources compensation fees, mining royalty, mineral right royalties and fees, and special oil gain premium. There are many types and also many problems. Our current tax policy does not reflect the special nature of petroleum resource exploration and development, and has no effective incentives to the exploration of poor resources and unconventional resources. In our tax system design, quantity-based collection made tax revenue away from the high oil price, and the existing levy standard cannot evidently reflect the differential earnings of petroleum resource, which delays the marginal oil field exploration to some extent. There are also many problems on the special oil gain premium levied from 2006. How to solve these problems reasonably and balance the relationship between different parties is a necessary and extremely complex and difficult issue.In our country some experts and scholars have started to pay attention to the petroleum tax system and have carried out a certain amount of research in the field. This paper draws on the results of previous studies, redefines the study object and category, and selects several tax items to study in depth which account for a large proportion in petroleum resource exploration. This paper is based on the actual situation in China and combined with some advanced foreign practices, and further put forward some reform proposals on our petroleum exploration tax system. On the one hand, facing the controversial taxes such as VAT, resource tax, this paper proposes some detailed pilot reform advices including introducing the modern VAT firstly in the field of petroleum resource exploration. On the other hand, this paper makes a number of specific policy suggestions against the particular industry of petroleum resource exploration to cause public attention on this issue. These recommendations not only absorbed the views of previous studies, but also have some degree of innovation.