China extends tax-free diesel export quota

Chinese refiners have been allowed to export 680,000 tons of diesel tax-free in the second quarter of 2009, local traders said. In a reversal of a previous policy meant to discourage the expansion of export-oriented energy- and carbon-intensive industries, Beijing began setting refined fuel export quotas starting this year under crude processing deals, a form of trade that allows refiners to import crude and export fuels without having to pay the country’s 17% value-added tax (VAT). The incentive for fuel exports comes amid a host of policy measures meant to buoy domestic enterprises at the risk of flooding global markets with more goods. Beijing also announced that it would raise export rebates on thousands of products from textiles to steel to petrochemicals. (April 12, 2009)