Sinopec China Petroleum Imported Crude Oil is Refunded

Recently, international oil prices have approached US$120 per barrel. However, the price of processed oil in the Mainland has not been able to meet international standards. PetroChina and Sinopec have faced a severe operating environment. The government has announced the implementation of importation and refund of value-added tax on refined oil imports to ease pressure on oil prices. However, oil companies have limited benefits. China News Service reported that crude oil import tax will also be implemented after the first levy, this policy will be implemented in the second quarter of this year, the most profitable Sinopec, the crisis of declining performance may be eliminated.
The China News Agency pointed out that the VAT policy adjustment of refined oil imports is only a prelude to the importation of crude oil and VAT has also been determined to be implemented after the levy. This is the largest "red envelope" given by the government to the two major oil companies: the relevant departments import value-added tax for crude oil. It has also been determined that there will be a first-time return, but the proportion of repatriation will be different, that is, the first 17% import VAT will be levied and the 75% of the requisition will be returned. This policy will be reflected in the third quarter of this year.
Return 75% after taxation
PetroChina and Sinopec had the same index on the other day. Starting April 1, the central government will provide appropriate subsidies for the losses resulting from the processing of imported crude oil. The grant funds will be allocated and liquidated on a monthly basis. According to the Beijing Youth Daily, the Ministry of Finance's monthly subsidy for the two major oil giants will be subsidized by 17% of the VAT rebate of 75% of imported crude oil. Based on the calculation of 10 million tons of crude oil imported by Sinopec on a monthly basis, Sinopec will process approximately 90 million tons of crude oil from the end of the second quarter to the end of the year, equivalent to 648 million barrels of crude oil. According to crude oil imports at the rate of US$100 per barrel, and US dollar against the Renminbi at 1:6.98, by the end of the year, Sinopec will receive approximately RMB 57.6 billion in VAT refunds.
In addition, the municipal government will adjust resource taxes. According to "Bloomberg," an oil and gas official who is affiliated with the Development and Reform Commission's Energy Bureau, said that the current special earnings (called windfall tax) is too low for a fuel price of $40 a barrel. The oil companies in the Mainland face very heavy operating pressure. According to the opinion of the Bureau, it is necessary to adjust this year as soon as possible.
The two oil stocks surged yesterday with news of the A-share rescue measures and possible adjustments to windfall profits. PetroChina’s A-shares once again reached a daily limit, with a high of 18.17 yuan (the same below) and a resumption of 16.7 yuan or more above the offer price. 18.15 yuan; H shares up 6.55% to 12.04 Hong Kong dollars, to close at 11.84 yuan, up 4.797%, the best performance in the three major Chinese oil stocks; Sinopec (0386) H shares once rose to 8.55 Hong Kong dollars, closing at 8.43 yuan Rose 3.44%.