China to Levy Environmental Tax

The government work report delivered by Premier Wen Jiabao last week, indicated that this year's inflation target of 3 percent, includes room for the introduction of an environmental tax and reforms on resources taxes. Environmental officials and some CPPCC members have voiced support for the measures.

Last week's government work report included the possibility of levying an environmental tax this year. On March 10, the Vice Minister of the National Development and Reform Commission, Xie Zhenhua, promised to step up taxation reforms to push environmental protection.

Xie Zhenhua, NDRC Vice Minister, said, "We will steadily push forward reforms on the prices of resources and environmental protection charges.

We will also actively implement the country's fiscal and tax policies to support energy conversation and emission reductions."

To achieve these goals, some CPPCC members have called for the introduction of an environmental tax as soon as possible.

Wang Yuqing, CPPCC member, said, "We should greatly accelerate the studying of the environmental tax and launch it as soon as possible. This will serve as a clear policy signal for enterprises, encouraging them to be more environmentally friendly."

It's believed that by replacing the current emission charges with an environmental tax, China can improve the control and enforceability of its environmental protection policies.

But some CPPCC members have cautioned that policy-makers should avoid significantly increasing the tax burden on businesses. Some have also suggested the tax revenues be earmarked for a fund aimed at curbing environmental pollution.

Reporter Liu Ying said, "In addition to an environmental tax, there are also calls for revising the tax on resources as early as possible. Many participants at the ongoing NPC and CPPCC sessions say "greening" the current tax system is a vital and urgent measure to help China meet the mounting ecological and environmental challenges.