China started collecting an environment tax to better protect the environment and cut pollutant discharge, as the country's Environmental Protection Tax Law took effect on Jan. 1, 2018.
The introduction of the tax called an end to the "pollutant discharge fee" which China had been collecting for nearly 40 years.
This is China's first tax clearly designed for environmental protection, which will help establish a "green" financial and taxation system and promote pollution control and treatment of pollutants, said Wang Jinnan, head of the Chinese Academy For Environmental Planning under the Ministry of Environmental Protection.
Under the Environmental Protection Tax Law, which targets enterprises and public institutions that discharge listed pollutants directly into the environment, companies will pay taxes for producing noise, air and water pollutants as well as solid waste. On tax rates, the central authorities will set upper limits and allow local governments to determine the rates on their own. Individuals do not need to pay the tax as it is applicable only to enterprises, public institutions and other business operators.
The central government will allot revenue from the environmental protection tax to local governments to motivate participation in the fight against pollution.