Hu, X;
Liu, J;
Yang, H;
Meng, J;
Wang, X;
Ma, J;
Tao, S;
(2020)
Impacts of Potential China's Environmental Protection Tax Reforms on Provincial Air Pollution Emissions and Economy.
Earth's Future
, 8
(4)
, Article e2019EF001467. 10.1029/2019ef001467.
Preview |
Text
2019EF001467.pdf - Published Version Download (5MB) | Preview |
Abstract
China's environmental protection tax (EPT) has been implemented since the beginning of 2018 to control environmental issues (e.g., air pollution). The current EPT law indicates that tax revenues are given to provincial governments without return. However, tax revenue redistribution is the key to achieving a so‐called “double dividend”; that is, an environmental tax could benefit both the environment and economic efficiency. Based on our previous analysis of the effectiveness of the current EPT, we further explore whether the double dividend could be achieved under different tax reforms based on the multiregion and multisectoral computable general equilibrium model. We find that recycling the EPT revenue to reduce household income tax (EPT_Int) is an efficient way to achieve the double dividend, and there is no double dividend if the EPT revenue is compensated by reducing enterprise income tax (EPT_Ent) or by investing in solar power (EPT_Sol). Combining EPT_Int and EPT_Sol could be a better approach if more air pollution emissions reductions are required to achieve the national reduction targets. At the provincial level, recycling the EPT revenues to reduce household income tax could offset the negative effect of environmental tax on the economy and achieve the double dividend in all provinces, especially the provinces with higher emission intensity, such as Shanxi, Hebei, Inner Mongolia, and Guizhou Provinces. This result shows that provinces with high emission intensity may further reduce air pollutant emissions during the post‐EPT era.
| Type: | Article |
|---|---|
| Title: | Impacts of Potential China's Environmental Protection Tax Reforms on Provincial Air Pollution Emissions and Economy |
| Open access status: | An open access version is available from UCL Discovery |
| DOI: | 10.1029/2019ef001467 |
| Publisher version: | https://doi.org/10.1029/2019ef001467 |
| Language: | English |
| Additional information: | Copyright © 2020 The Authors. This is an open access article under the terms of the Creative Commons Attribution License (http://creativecommons.org/licenses/by/4.0/), which permits use, distribution and reproduction in any medium, provided the original work is properly cited. |
| Keywords: | environmental tax reform, China's environmental protection tax, double dividend, computable general equilibrium model, air pollution, household welfare |
| UCL classification: | UCL UCL > Provost and Vice Provost Offices > UCL BEAMS UCL > Provost and Vice Provost Offices > UCL BEAMS > Faculty of the Built Environment |
| URI: | https://discovery.ucl.ac.uk/id/eprint/10094393 |
Archive Staff Only
 |
View Item |
