China mulls tax plan for environmental protection

Updated: 2008-01-06 19:10

BEIJING -- Chinese government departments of tax and environment will try to work out a taxation plan to promote environmental protection in 2008 and the candidate plans are now under appraisal.

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The environment tax, one of the key taxation policies China plans to push forward this year, is going through careful study and appraisal by the Ministry of Finance, State Administration of Taxation and State Environmental Protection Administration.

Two researchers with the Ministry of Finance Sun Gang and Xu Wen proposed three candidate plans of collecting environment tax in their report published in November of 2007, according to Beijing-based Caijing Magazine.

Based on the principle of "pay according to profits", the first plan suggests government collect tax from companies in accordance with how much they earn from the products which consume resources or pollute the environment, said Dr. Xu Wen. He said this kind of general taxation will be imposed on all the companies since almost all the products consume resources.

According to the second plan, companies would pay tax according to how much pollutant they have discharged, said Xu, adding that the tax will target the discharge of sulfur or sulphide, carbon dioxide, sewage, solid waste and other forms of pollutant.

He said that the third plan would ask consumers of potentially polluting products, such as fossil fuel, ozone-consuming commodities,fertilizer and pesticide, to pay tax.

Meanwhile, the Ministry of Finance said it might be a more pressing task for them to raise the resource and consumption tax to give more consideration to environmental protection while expanding the current taxation system and adding new kinds of tax.

Beside the plan for environment tax, the country has already adopted the law of environment protection and other regulations and is encouraging domestic companies to introduce more environment-friendly technology and production models, according to the SEPA-sponsored newspaper China Environment News.

The public awareness of and participation in environment protection is also vital in this period of time, when China is trying to adopt a scientific and sustainable mode of development, the newspaper said.

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