New national tax to hit polluters beginning 2018

The Chinese government will formally implement an environmental protection law on January 1 that will impose a tax on polluters based on the amount and type of pollution they release.

The law, which was approved in December 2016, dictates that Chinese enterprises that discharge pollutants directly into the environment will pay an environmental protection tax, noted a report from the China News Service on Friday.

According to the law, enterprises will be charged between 1.4 yuan ($0.2) and 14 yuan per unit of water pollution they discharge and between 1.2 yuan and 12 yuan per unit of air pollution they emit. A tax ranging between 5 yuan and 1,000 yuan will charged per ton of solid waste created by enterprises.

A benchmark tax rate for different provinces and municipalities will allow them to make more detailed regulations, the report noted.

The majority of Chinese provinces and cities have already passed local environmental protection laws.

For example, the Beijing municipal government requires air polluters to pay a tax of 12 yuan for each unit of pollution, while the adjacent Hebei provincial government charges a tax of 9.6 yuan per unit to air polluters.

Ye Qing, a deputy director of the statistics bureau of Central China’s Hubei Province, said that in the past the government fined polluting enterprises, but now the penalties are written in law.

“During those years, many domestic companies came to realize that they should pay a price for polluting, and so there won’t be many difficulties in implementing the new law,” Ye told the Global Times on Friday, adding that compared with pollution penalties, pollution taxes will be more transparent and will prompt enterprises to take environmental protection into consideration when doing business.

“If they don’t want those taxes to be a heavy burden, the only thing they can do is to conform to the government’s environmental protection standards,” Ye noted.

The China News Service report also cited some executives of domestic manufacturing companies as saying that they would support implementation of the environmental protection law.

China in recent years has shifted its focus from rapid economic growth to a green GDP that is more sustainable and environmental friendly.