In accordance with the provisions of Provisional Regulations of the People’s Republic of China on Excise Tax, excise tax is levied on entities and individuals engaging, within the territory of the People’s Republic of China, in production, commissioned processing, and importation of taxable consumer goods as well as on entities and individuals that sell taxable consumer goods determined by the State Council. Limited to a certain scope, excise tax is not applicable to all goods but only levied on specific consumer goods as stipulated in Provisional Regulations of the People’s Republic of China on Excise Tax. The primary objectives of imposing excise tax are to promote environmental protection, save resources, encourage rational consumption and raise fiscal revenue. Currently, there are 15 taxable items under excise tax, including tobacco, wine and alcohol, automobiles, refined oil products, batteries, coating materials, high-end cosmetics, precious jewelry and gems, firecrackers and fireworks, motorcycles, golf balls and gears, luxury watches, yachts, disposable wooden chopsticks, and solid wood flooring. Different tax rates are applied to different taxable items.