China's two largest oil producers, PetroChina and the Sinopec Group, said Thursday night that the Ministry of Finance (MOF) has raised the exemption threshold on the so-called "windfall tax" on upstream oil producers to US$55 per barrel of crude oil since November 2011.
The levy, described by the MOF as a "special oil sales charge," will be set at a progressive rate between 20 and 40 percent on the excess of the average realized oil price from a base of US$55 per barrel, compared with US$40 previously, the oil companies said.
The charge is 20 percent when the price is between US$55 and US$60 and will rise progressively by 5 percentage points for every US$5 increase to a limit of 40 percent when the price sits above US$75 per barrel.