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What's next for China's coal sector: will lowering VAT help domestic miners?

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Report summary

Lowering VAT is likely to be the next announcement from China's government to support domestic coal producers. Adjustments to VAT have a marginal impact on China's coal sector as this step does not address fundamental problem of weak demand and oversupply.

What's included

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  • Document

    What's next for China's coal sector: will lowering VAT help domestic miners?

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Table of contents

  • Executive summary
  • VAT: the next step for China's government supports
  • VAT will provide minimal support to domestic suppliers
  • Lower VAT will not impact imports
  • Conclusions

Tables and charts

This report includes 3 images and tables including:

Images

  • Operating margin with 17% VAT– domestic thermal supply to coastal China at RMB430/t FOB Qinhuangdao (5500 kcal NAR energy adjusted)
  • Operating margin with 13% VAT– domestic thermal supply to coastal China at RMB430/t FOB Qinhuangdao (5500 kcal NAR energy adjusted)

Tables

  • Delivered cost comparison of domestic and imports in south China (RMB/t)

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