Beijing is considering imposing an emissions tax by 2015, which will hit the biggest industries that burn fossil fuel and encourage them to invest in carbon-cutting technologies.
The Economic Information Daily, run by Xinhua, quoted Su Ming, deputy head of the Ministry of Finance's research institute for fiscal science, as saying that the body had submitted a new carbon tax proposal to the ministry.
It suggested the tax be rolled out sometime between next year and 2015, targeting the largest fossil-fuel burners that emit greenhouse gases. The tax rate will take into account industries' emission volumes and profitability.
The institute's director, Jia Kang, was quoted as saying that to relieve the extra burden on firms, Beijing could consider cutting profit tax. This would encourage polluters to upgrade their technology since the carbon tax would be levied based on emissions volumes.
There are technologies to capture and store carbon gases underground, but they are still in the experimental stage. They are hindered from mass-market production by high costs and the lack of government incentives.
The institute proposed an initially charge of 10 yuan (HK$12) per tonne of carbon gas, while the Ministry of Environmental Protection favoured 20 yuan a tonne, the Economic Information Daily said.
