消费税改革(xiāofèishuì gǎigé):Reform of consumption tax

Some media reports suggest launching of a reform for consumption tax after the country nears completing its process of replacing the business tax with value-added tax.

Consumption tax is the tax levied during the circulation process of consumer goods. Imposed in China since 1994, it is a typical indirect tax that is included in the selling price of commodities. The tax is finally paid by consumers.

At present, consumption tax is levied on 13 kinds of commodities, including tobacco, wine, cosmetics, gems and expensive jewelry, petroleum products and cars. The reform is expected to include some high-energy consumer and high-polluting goods and some luxury products on the consumption tax list. And some commodities that do not deserve to be levied consumption tax will be removed from the list.

Currently, China's consumption tax is levied by the national tax department, which makes it a central rather than provincial tax. After the reform, the tax could be shared by the central and local governments.

Experts say that if the consumption tax becomes a shared tax, it could be one of the major taxes in provinces and regions, and boost local governments' autonomy in levying tax.