China to increase tax on coke and aluminum exports

Bloomberg reported that China, the world's largest aluminum producer, will impose a tax on exports of the metal's alloys to curb over-investment in energy intensive industries.

The Ministry of Finance said in a statement that duties on shipments of aluminum alloy will be temporarily set at 15% effective from August 20th 2008. Export taxes on coking coal and coke will be increased.

The ministry said the tax may curb aluminum alloy exports, boosting aluminum prices, which jumped to a record last month after some Chinese producers agreed to cut output to help the world's fourth- largest economy combat a sixth year of power shortages.

Mr Wan Ling analyst with CRU International Ltd said ¡°The rate of increase is higher than we expected. This will further depress a sluggish domestic market, but will help LME prices.''

The statement said, without saying how long the taxes will be in place taxes on coke exports will be raised to 40% from 25% while the rate on coking coal will be lifted to 10% from 5%. The ministry also imposed a 10% tax on metabituminous coal.

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