To encourage companies to bring in technology that will lessen pollution and furthermore lessen the tax they will have to pay, Chinese lawmakers approved the Environment Tax Law during the 25th session of the 12th Standing Committee of the National People's Congress (NPC) which concluded on Sunday.
The lawmakers still have a year to draft the rules and regulations for the implementation of the new law which will be effective on Jan. 1, 2018.
According to a Xinhua News Agency posted in the website of the Ministry of Environmental Protection (MEP) of the People's Republic of China, the tax rate for noise pollution will range from 350 to 11,200 yuan per month depending on the decibel level; for each stipulated unit of air pollutants, 1.2 yuan; for each stipulated unit of water pollutants, 1.4 yuan; for every ton of coal waste, 5 yuan; and, 1000 yuan for each ton of hazardous waste.
Another Xinhua source posted in China Daily said that China has an already established pollution discharge fee system which allowed the collection of 17.3 billion yuan from some 280,000 businesses in 2015, but the loopholes in this system were abused by some local government units who exempt some businesses that are big contributors to economic revenues from the pollution fees.
The passing of a strong and binding law will fix this weakness in the system and will possibly eliminate the problem of luring companies to invest with a promise of exemption from pollution discharge fee.
The central government has also tasked inspection teams to evaluate the performance of local government with regard to environmental protection. More than 3,000 officials were held in the first round of inspection and the second round is ongoing.
When the law takes effect, China can collect about 50 billion yuan every year from environment taxes, according to an estimate by the Central University of Finance and Economics, as reported by the Global Times.