China to remove rare earth export taxes in May

HONG KONG (REUTERS) - China will scrap taxes on overseas sales of rare earth from May, the Ministry of Commerce said, further easing export curbs after a move earlier this month to terminate a quota system.

China was widely expected to abolish the quota system and taxes following a World Trade Organisation (WTO) ruling in March last year that the tariff and quota system was discriminatory and gave unfair advantage to domestic consumers.

Rare earth exports are subjected to 15 or 25 per cent tariffs currently. The taxes will be retained only until May 2.

China is the world's dominant exporter and producer of rare earths, which include 17 metals that are used in high tech products such as iPhone and military equipment.