Haichuan Chemical Forum provides an exclusive analysis of the first environmental protection tax law: the Environmental Protection Tax Law of the People’s Republic of China

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The Haichuan Chemical Industry Forum provides an analysis of the first environmental protection tax law, the \"Environmental Protection Tax Law of the People’s Republic of China\" – background materials. After nearly a decade of preparation and refinement, China’s first environmental protection tax law was finally enacted on December 25, 2016. That afternoon, the 25th meeting of the 12th Ren Congress came to an end, and the Environmental Protection Tax Law of the People’s Republic of China (hereinafter referred to as the \"Environmental Protection Tax Law\") was adopted by a vote of 145 in favor, 1 against, and 4 abstentions. This is the first separate tax law enacted in China since ***, raising the number of tax categories in the country to 19. This new tax will come into effect on January 1, 2018. Key points of the Environmental Protection Tax Law: 1. Clarifying the scope of entities that are subject to taxation. In other words, the original payers of the pollution discharge fees become the taxpayers of the environmental protection tax. Of course, exemptions for activities that do not involve production or operation and that do not involve direct discharge of pollutants into the environment within sovereign jurisdiction. 2. Define and quantify the tax categories for the environmental protection tax. The major categories include air pollutants, water pollutants, solid waste, and noise. 3. Clarify the basis for calculating the environmental protection tax. It is mainly based on the calculation method for pollution discharge fees. Use the existing pollutant equivalent value table for conversion calculations. 4. Clarify the management methods, responsibility allocation, and filing procedures for the collection of the environmental protection tax. The environmental protection authorities are responsible for supervision and testing, while the tax authorities are in charge of collecting taxes. 5. The collection period is delayed by one year. The biggest highlight of the Environmental Protection Tax Law seems to be a last-minute idea that is more superficial than anything else, essentially serving no real purpose. To use a proverb: it’s like applying lime to one’s mouth – it’s just talk without any substance. It would be better to wait for half a year until all preparations are complete before enacting the law, and then delay its implementation by another half year. Special attention should be paid to Article 13: Where the concentration levels of taxable air pollutants or water pollutants emitted by taxpayers are 30% lower than the standards set by the state and local authorities, the environmental protection tax shall be levied at a rate of 75% reduced. If the concentration of taxable air pollutants or water pollutants emitted by taxpayers is 50% lower than the national and local standards for pollutant emissions, the environmental protection tax shall be levied at a reduced rate of 50%. A reduction policy that offers an additional tier beyond the pollution fee. Finally, let’s look forward together to the brewing process again in a year.