Beijing air pollution

The Chinese capital has for many years suffered from serious air pollution. Primary sources of pollutants include exhaust emission from Beijing's more than five million motor vehicles, coal burning in neighbouring regions, dust storms from the north and local construction dust. A particularly severe smog engulfed the city for weeks in early 2013, elevating public awareness to unprecedented levels and prompting the government to roll out emergency measures. 


Beijing hopes carbon dioxide tax will help reduce pollution

PUBLISHED : Wednesday, 20 February, 2013, 12:00am
UPDATED : Wednesday, 20 February, 2013, 12:51pm

Beijing will levy a tax on carbon dioxide emissions as part of new fiscal measures aimed at addressing the mainland's worsening pollution problem, a senior official at the Ministry of Finance said.

Jia Chen, head of the ministry's tax policy division, wrote in an article published on the ministry's website that the central government should improve its consumption tax regime to help achieve its energy-saving and emission control goals.

"We should proactively push forward the reform of taxation related to the environment, such as replacing the existing pollution discharge fee by an environmental protection tax," he wrote. "Carbon dioxide emissions should be subject to this tax."

We should proactively push forward the reform of taxation related to the environment, such as replacing the existing pollution discharge fee by an environmental protection tax

Coal-fired-power producers have been paying pollution discharge fees on their emissions of sulphur gases for more than a decade, although Beijing has encouraged them to install equipment to collect such gases by giving them financial incentives. Carbon dioxide has so far not been subject to levies.

Jia's article came as Beijing stepped up the pressure on producers of polluting products to cut emissions, after the capital city was last month shrouded in dense smog from the worst air pollution in recent memory.

The State Council this month urged domestic oil refiners to accelerate the process of upgrading the quality of their motor fuel.

Jia said the environmental protection tax should be collected by local governments, without suggesting any timeframe.

In 2009, a Ministry of Finance think tank called for a carbon tax to be imposed by this year, but the global economic crisis stalled the plan.

Early last year, the Economic Information Daily, run by Xinhua, quoted Su Ming, deputy head of the ministry's research institute for fiscal science, as saying the institute proposed a levy of 10 yuan (HK$12.42) per tonne of carbon dioxide by 2015.

Meanwhile, Jia said Beijing should study the feasibility of taxing pollution-prone and highly energy-intensive products such as batteries and non-commercial luxury aircraft.

He also urged the implementation of a plan to reform the resource tax on coal production. The plan was first proposed in 2006, but was shelved owing to concern it would stoke inflation.

Such reform entails the taxing of coal sales revenue. The tax is currently levied on sales volume.

Jia also suggested that other mining products and water should be subjected to resource levies.




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