Umore Intelligence

New environmental tax law makes Chinese industrial discharger more willing to buy environmental services

At the end of 2016, the new environmental tax law has been finally approved. It means that the discharge fee, which has been imposed to industry since 1979, would be replaced by the new environmental tax.

Among the lines of the new tax law, one additional tax reduction rule seems sexy to China’s pollutant dischargers.

There is only one condition that a company can get discharge fee reduction according to the old discharge fee system:

  • 50% environmental tax reduction for those who discharge 50% lower concentration than the standard limitations.

In terms of the new tax system, one more condition is added:

  • 75% environmental tax reduction for those who discharge 30% lower concentration than the standard limitations.

One additional standard line may not seem so important. But in fact, China’s discharge standards are even stricter than Europe. Achieving 30% contamination reduction is way more feasible. In some sense, lack for incentive of companies’ environmental investment is one of the reasons contribute to China’s environmental problems. The new tax law at least makes pollution control measures more appealing for the dischargers.

Attachment: tax standard table for different kinds of pollutant discharges.

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