China officially kicked off its resource tax reforms today (Friday). All natural resources from iron ore to timber will now be taxed on their selling price, instead of sales volume.

The reform began its pilot run in the oil and natural gas sector, and gradually expanded nationwide to cover all sectors.

The reforms also annulled other fees and charges in order to cut corporate costs. The tax rate is determined by the central government as a range and local authorities will be allowed to tweak the rates within the range.

Analysts say the changes will help restructure the resource sector.

"The price-based regime would stimulate companies to better use resources. The old way of taxation didn't concern the price, but only the amount of exploration. Now it is price-based, and companies paying more attention to the full use of resources will benefit," said Zhang Tianli, deputy director of China Finance Ministry.

"The reform lowered the overall tax for the natural resource sector, meaning a lighter burden for corporations. This would help stabilize the sector and improve industry restructuring," said Liu Shangxi, director of China Fiscal Science Inst.