I learned that a coal company needs to pay the resource tax and resource compensation fee to obtain the right to mine the coal. The former is about 1 percent of the current coal price, calculated on the basis of the volume of actually excavated coal; the latter is levied on the basis of the gross profit of sales at the rate of 1.18 percent. By contrast, the same rates in Western developed countries are something between 8 percent and 10 percent.
Such taxes are obviously too low. And even these low taxes are often evaded by coal mine owners in collaboration with some local officials, as has been widely reported in the country's coal mining regions. Natural resources belong to the whole nation but are now taken by a small part of the population nearly free of charge. What have the authorities done to address this problem?
As the taxes and fees they pay are calculated according to output and sales rather than the prospected and proved reserve, coal miners naturally mine those parts of the reserve that are easy to excavate and ignore those that they find difficult to mine. This undoubtedly leads to the huge waste of coal and irrecoverable damage to the reserve. In most of China's widespread small coal mines, the excavation rate is 15 percent, while the reasonable rate, as required by the government, is no less than 75 percent.
What is more, illegal mining is rampant in many places. According to China News Weekly published on Monday, unauthorized mining "can be seen everywhere" in Ningwu, a major coal-producing county in Shanxi, and "it is easy to earn 200,000 yuan a night" by mining in illegally excavated pits.
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