China, the world's leading coal producer and consumer, has begun to levy resource tax on coal based on sales prices instead of production from Dec 1, in a move to shore up the industry and improve the deteriorating environment.

The key to the reform, however, is to clear out charging fees involving coal. Chinese coal producers used to pay taxes as well as fees in various names.

The State Council decided to clear off these fees before implementing the resource tax reform on coal at an executive meeting on Sept 29.