The Ministry of Finance and the State Administration of Taxation issued a notice stating that from January 1 to December 31, 2010, domestic consumption of fuel oils used as raw materials for the production of chemical products such as ethylene and aromatics was exempted from consumption tax, and used to produce ethylene, aromatics, etc. Imports of fuel oil from raw materials of chemical products return consumption tax.
Analysts pointed out that the encouragement of deep processing of fuel oil can not only ease the shortage of domestic important chemical products such as ethylene and aromatics, but also reduce the proportion of direct combustion, which is conducive to energy conservation and emission reduction of industrial and power generation enterprises. As China's previous preferential policy for fuel oil used as chemical raw materials has always been given a tax rebate, this new tax-free policy will not have a direct impact on the main business, but the clear definition of the tax exemption is clearly a big positive for fuel oil chemical industry. A major increase in capital investment in an industry is expected.
Fuel oil chemical industry encouragement policy Bright fuel oil refers to the residual black sticky residue of crude oil after distillation. It is an intermediate product in the refining process. It can not only be directly burned, but also processed into olefins, lubricating oils, diesel oil, chemical fertilizers, etc. through deep processing and refining. Chemical Products.
In the situation of severe shortage of crude oil, fuel oil is China's encouragement to import resources, especially for local oil refining companies, fuel oil is its main production material. Zhuo Chuang Information Fuel Oil analyst Lu Bin introduced that at present, China's fuel oil consumption is about 37 million tons, of which 40% is used for large slow fuel such as ships, and 20% is used for power generation and other industrial hot stove fuel, only 40% Used as a chemical raw material.
Since the beginning of last year, China has imposed a consumption tax of 0.8 yuan per liter on fuel oil produced or imported, but it has implemented a preferential tax rebate policy for chemical products that use fuel oil directly as raw materials. The notice issued by the Ministry of Finance and the State Administration of Taxation said that companies that use fuel oil to produce chemical products such as ethylene and aromatic hydrocarbons account for more than 50% (including 50%) of the total production of fuel oil used by the company and enjoy the provisions of this Circular. Preferential policies.
“This new policy is more significant than its practical significance.†Lu Bin believes that from the past tax rebates to the current tax exemption, changes in tax revenues have little effect on the main business, but the policy is further clear, which will help improve the oil refining business. With the enthusiasm for deep processing of fuel oil, more funds will be invested in the fuel oil chemical industry in the future.
Ethylene production is profitable Ethylene is undoubtedly the most noteworthy of the products in fuel oil chemicals. As a "world factory," China is a major consumer of ethylene. Although oil giants have made large-scale ethylene projects in recent years, with the continued rapid economic development, there is still a large gap in ethylene supply in China. The relevant person in charge of the Industry Coordination Department of the National Development and Reform Commission had previously revealed that in 2009 China's ethylene self-sufficiency rate was only 50%. Even by 2015, China's ethylene production capacity will reach 19 to 21 million tons, and the self-sufficiency rate will only be 63% to 67%. .
Experts pointed out that although the petrochemical industry in developed countries has experienced a peak in development and the global ethylene production capacity is about to enter a surplus period, given the importance of ethylene in modern industry, it is still necessary for China to expand its ethylene production capacity. Lu Bin said that to encourage fuel oil and chemical industry, in addition to the goal of energy conservation and emission reduction, it will also form an important supplement to China’s olefin supply.
It is worth noting that the implementation period of this tax exemption policy is this year, and it is from this January that the international ethylene supply situation has become tight and prices have risen sharply. After entering August, ethylene prices have even reached the international financial crisis. s level.
Lü Bin believes that the short-term significance of this national regulation is to encourage petrochemical companies to release production capacity in order to ease the contradiction between supply and demand in the event of tight market supply. Despite the fact that the production of ethylene in fuel oil is not high in ethylene production in China, the elimination of consumption tax will Significantly increase the profits of related companies, the policy point is quite obvious.
“Withholding pressure†Tax exemption does not involve other purposes In contrast to the profitability of fuel oil and chemical industry, the new tax-free policies promulgated by the two departments do not involve other uses of fuel oil. The notice pointed out that fuel oil production enterprises that sell fuels without using raw materials for the production of chemical raw materials such as ethylene and aromatic hydrocarbons should be subject to stipulated consumption taxes; chemical companies that produce chemical products such as ethylene and aromatics must purchase tax-free fuel oil for external sales and have not used it. For the production of raw materials for ethylene and aromatics chemical products, consumption tax shall be levied.
After the state raised the consumption tax on fuel oil last year, some gas-fired power plants with fuel oil as the main fuel in Guangdong and other places were immediately said to have fallen into losses, and calls for reductions in consumption taxes have continued to spread. At that time, there was news that fuel consumption tax will be reduced this year.
However, this tax exemption only involves fuel oil and chemical industry. The policy of “preserving pressure†also suits the current environment of energy conservation and emission reduction. Analysts believe that the policy introduced this time aims to achieve the cleanest and most efficient use of fuel oil as an intermediate energy source by encouraging deep processing. Fuel oil, as a direct fuel, has high pollution and energy consumption. The reduction of fuel oil consumption tax for power plants contradicts the country's macroeconomic policies for promoting clean energy. “With this year’s extremely stringent energy saving and emission reduction situation, it is almost impossible to obtain preferential tax policies.â€
Analysts pointed out that the encouragement of deep processing of fuel oil can not only ease the shortage of domestic important chemical products such as ethylene and aromatics, but also reduce the proportion of direct combustion, which is conducive to energy conservation and emission reduction of industrial and power generation enterprises. As China's previous preferential policy for fuel oil used as chemical raw materials has always been given a tax rebate, this new tax-free policy will not have a direct impact on the main business, but the clear definition of the tax exemption is clearly a big positive for fuel oil chemical industry. A major increase in capital investment in an industry is expected.
Fuel oil chemical industry encouragement policy Bright fuel oil refers to the residual black sticky residue of crude oil after distillation. It is an intermediate product in the refining process. It can not only be directly burned, but also processed into olefins, lubricating oils, diesel oil, chemical fertilizers, etc. through deep processing and refining. Chemical Products.
In the situation of severe shortage of crude oil, fuel oil is China's encouragement to import resources, especially for local oil refining companies, fuel oil is its main production material. Zhuo Chuang Information Fuel Oil analyst Lu Bin introduced that at present, China's fuel oil consumption is about 37 million tons, of which 40% is used for large slow fuel such as ships, and 20% is used for power generation and other industrial hot stove fuel, only 40% Used as a chemical raw material.
Since the beginning of last year, China has imposed a consumption tax of 0.8 yuan per liter on fuel oil produced or imported, but it has implemented a preferential tax rebate policy for chemical products that use fuel oil directly as raw materials. The notice issued by the Ministry of Finance and the State Administration of Taxation said that companies that use fuel oil to produce chemical products such as ethylene and aromatic hydrocarbons account for more than 50% (including 50%) of the total production of fuel oil used by the company and enjoy the provisions of this Circular. Preferential policies.
“This new policy is more significant than its practical significance.†Lu Bin believes that from the past tax rebates to the current tax exemption, changes in tax revenues have little effect on the main business, but the policy is further clear, which will help improve the oil refining business. With the enthusiasm for deep processing of fuel oil, more funds will be invested in the fuel oil chemical industry in the future.
Ethylene production is profitable Ethylene is undoubtedly the most noteworthy of the products in fuel oil chemicals. As a "world factory," China is a major consumer of ethylene. Although oil giants have made large-scale ethylene projects in recent years, with the continued rapid economic development, there is still a large gap in ethylene supply in China. The relevant person in charge of the Industry Coordination Department of the National Development and Reform Commission had previously revealed that in 2009 China's ethylene self-sufficiency rate was only 50%. Even by 2015, China's ethylene production capacity will reach 19 to 21 million tons, and the self-sufficiency rate will only be 63% to 67%. .
Experts pointed out that although the petrochemical industry in developed countries has experienced a peak in development and the global ethylene production capacity is about to enter a surplus period, given the importance of ethylene in modern industry, it is still necessary for China to expand its ethylene production capacity. Lu Bin said that to encourage fuel oil and chemical industry, in addition to the goal of energy conservation and emission reduction, it will also form an important supplement to China’s olefin supply.
It is worth noting that the implementation period of this tax exemption policy is this year, and it is from this January that the international ethylene supply situation has become tight and prices have risen sharply. After entering August, ethylene prices have even reached the international financial crisis. s level.
Lü Bin believes that the short-term significance of this national regulation is to encourage petrochemical companies to release production capacity in order to ease the contradiction between supply and demand in the event of tight market supply. Despite the fact that the production of ethylene in fuel oil is not high in ethylene production in China, the elimination of consumption tax will Significantly increase the profits of related companies, the policy point is quite obvious.
“Withholding pressure†Tax exemption does not involve other purposes In contrast to the profitability of fuel oil and chemical industry, the new tax-free policies promulgated by the two departments do not involve other uses of fuel oil. The notice pointed out that fuel oil production enterprises that sell fuels without using raw materials for the production of chemical raw materials such as ethylene and aromatic hydrocarbons should be subject to stipulated consumption taxes; chemical companies that produce chemical products such as ethylene and aromatics must purchase tax-free fuel oil for external sales and have not used it. For the production of raw materials for ethylene and aromatics chemical products, consumption tax shall be levied.
After the state raised the consumption tax on fuel oil last year, some gas-fired power plants with fuel oil as the main fuel in Guangdong and other places were immediately said to have fallen into losses, and calls for reductions in consumption taxes have continued to spread. At that time, there was news that fuel consumption tax will be reduced this year.
However, this tax exemption only involves fuel oil and chemical industry. The policy of “preserving pressure†also suits the current environment of energy conservation and emission reduction. Analysts believe that the policy introduced this time aims to achieve the cleanest and most efficient use of fuel oil as an intermediate energy source by encouraging deep processing. Fuel oil, as a direct fuel, has high pollution and energy consumption. The reduction of fuel oil consumption tax for power plants contradicts the country's macroeconomic policies for promoting clean energy. “With this year’s extremely stringent energy saving and emission reduction situation, it is almost impossible to obtain preferential tax policies.â€
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