Climate change taxation reforms and incentives in China

Yes.

Environment Protection Tax (EPT) has been introduced and the PRC EPT Law has taken effect since 1 January 2018. The enterprises, organisations and other business operators who release taxable pollutants directly to the environment shall be the EPT payer. “Taxable pollutants” include air pollutants, water pollutants, solid pollutants and noises covered by the lists attached to the EPT Law. The converted equivalent volume of release and decibel of noises shall be the tax basis of EPT.  Volume-based tax rates of various types of pollutants are provided by the EPT Law.

Vehicle Vessel Tax (VVT) was introduced in 2006. The owner or the operator of taxable vehicles and vessels shall pay VVT. Volume-based tax rates are provided in the attachment of the PRC VVT Law for various types of taxable vehicles and vessels.

N/A

Resource Tax was introduced in 1993. The organisations or persons exploiting mineral products (including gas, oil and charcoal) or producing salts shall pay Resource Tax. The tax basis is normally the sales volume or the sales price, depending on the stipulations in the attachment of the Resource Tax regulations which provide volume-based or price-based tax rates for different types of taxable goods

No, but release of taxable carbon materials is subject to EPT.

No exclusive incentives, but if the taxpayer is devoted to promoting technological improvements in the field of environmental protection, it may apply for an income tax cut and a VAT break offered to general technology transfers and developments.

No recent developments, but the PRC EPT Law took effect from 1 January 2018.

The PRC government pays high tribute to environment reform these years.  Many administrative means have been used to restrict the over-emission of pollutants (e.g., the establishment of pollutant-emission factories are not approved or required to be relocated, many economic development zones do not welcome the investment in pollution-ridden industries, EPT is introduced to demotivate the pollutants release) - we see these means as pre-event administration which is more effective than post-event punishment.