Need for fuel tax

Media reports about the imminent introduction of a fuel tax is unlikely to bring about real progress in the reform of China's oil pricing mechanism if policymakers keep dodging the issue.

The fact that the country is falling far behind its schedule to raise energy efficiency by 20 percent between 2006 and 2010 should make it a compelling case for the pricing authorities to do what they can now.

It was reported recently that the National Development and Reform Commission, the country's top economic planning body, is working with other government departments on reforming China's retail oil price mechanism and introducing a fuel tax.