The Impact Of Environmental Protection On "Fee To Tax" And The Challenges Ahead

The draft environmental protection tax law was submitted to the twenty-second session of the Standing Committee of the twelve National People's Congress for consideration. The draft proposed the introduction of environmental protection tax in China, and the environmental protection tax has formally entered the legislative process. The environmental tax is expected to be formally implemented in January 1, 2017. The Levy of environmental taxes is not so good, nor can it shoulder the heavy responsibility of environmental protection. Even if we look at it with the usual heart of fee to tax, its future path will not be smooth sailing.

　　 Main highlights of the environmental protection tax law (Draft)

1. charging standards for objects and sewage charges

In accordance with the principle of "shifting tax burden", this legislation transfers the existing sewage charge system to the green tax system. According to the draft, from the sewage charges "tax shifting" to the environmental tax, the object of environmental protection levy is linked to the existing sewage charges, and the tax targets are 4 categories: air pollutants, water pollutants, solid waste and noise. The draft adopts the current sewage charge standard as the lower limit of the tax on environmental protection. It stipulates that the amount of air pollutants is 1.2 yuan for each pollution equivalent, 1.4 yuan for water pollutants, 5 yuan to 1000 yuan per ton for solid waste, and 350 yuan to 11200 yuan per month for noise.

2. what circumstances can be exempt from environmental taxes?

The main body of environmental tax collection in the future does not include:

(1) it is not imposed on ordinary residents. The draft also proposes to discharge taxable pollutants to the centralized sewage treatment and garbage disposal places in accordance with the law, and pay the environmental tax if payment is made. It can be seen from the above two points that the taxpayers of environmental taxes are enterprises and will not be charged to ordinary residents.

(2) tax exemption for vehicle pollution. The tax preference is listed in the draft. It is clearly stated that taxable pollutants discharged from motor vehicles, ships and aircraft and other mobile pollution sources should be duty-free. In addition, taxable pollutants such as agricultural production (excluding large-scale aquaculture) will also be tax-free. The concentration values of the discharged taxable air pollutants and water pollutants are less than 50% of the pollutant discharge standards prescribed by the state or local authorities. Half Taxation 。

What industries do environmental taxes affect?

Chen Jining, Minister of the Ministry of environmental protection, has said that the core purpose of the establishment of the environmental tax is not to increase taxes, but to set up a mechanism to encourage enterprises to emit less pollutants and to pay more taxes and less taxes. According to the "environmental protection tax law (Draft)", the focus of environmental protection tax monitoring (sewage) taxpayers refers to the key monitoring enterprises such as thermal power, iron and steel, cement, electrolytic aluminum, coal, metallurgy, building materials, mining, chemical, petrochemical, pharmaceutical, light industry (brewing, paper making, fermentation, sugar, vegetable oil processing), textile, leather and other key polluting industries such as taxpayers and other pollute industries. This means that once the green tax is levied, the above industries will be more significantly affected.

From the point of view of the object of Taxation, air pollutants in the four major pollutants will account for "big head". According to the draft tax standard, about 90% comes from air pollutants, and about 10% comes from water pollutants. From the industry forecast, air pollution, ferrous metal smelting and calendering processing industry, non-metallic mineral products industry, non-ferrous metal smelting and calendering processing industry, chemical industry, power, thermal production and supply industries and other 5 industries to pay environmental taxes, accounting for 88% of the total ambient air pollution bonded income. In water pollutants, 8 industries, including chemical industry, papermaking, medicine, textile industry, ferrous metal smelting and calendering processing, agricultural and sideline food processing, fermentation and brewing, leather making, will pay 80% of the total environmental taxes.

Two types of enterprises will benefit from the implementation of the green tax in the future. The first category is the enterprises that have always paid more attention to energy conservation and environmental protection. For example, some central enterprises, their emission targets have reached the international leading level. The second type of beneficiaries are enterprises engaged in energy conservation and environmental protection businesses, such as sewage treatment, waste gas treatment, solid waste management and other industries. After the implementation of the green tax, more business opportunities will be gained. The second type of enterprises include some third party enterprises that are engaged in environmental protection, including environmental protection departments and environmental protection business segments of some enterprises groups. The third party environmental monitoring and environmental audit will play an important role, and the third party enterprises will gain more opportunities in the industrial park and the upgrading and transformation of energy saving and environmental protection in traditional industries because of their business focus, patent technology and talent reserves.

　　 Four major queries and answers to environmental taxes

Recently, the Standing Committee of the National People's Congress began to "environmental protection" submitted by the State Council. tax law (Draft) for consideration, this marks the entry of the environmental protection tax into the legislative process, and the environmental tax is expected to be formally implemented in January 1, 2017. At present, academia, taxation system, environmental protection system and the public have different degrees of understanding of the draft law, and they also raise many questions and suggestions for improvement.

1. can environmental protection tax law really protect the environment?

At present, there are many kinds of taxes involving environmental protection in China, such as taxes on highly polluting consumer goods in the consumption tax, tax exemption for clean vehicles in vehicle purchase tax, preferential treatment for environmental protection in enterprise income tax, and taxation of environmental pollution resources in resource tax. These taxes have increased the tax burden of polluting products in varying degrees, and also played a role in environmental protection to a certain extent. The essence of the current environmental tax is the sewage tax, and the sewage charges will be changed to taxes instead of adding new taxes. In principle, the burden of the enterprises will not increase significantly. Therefore, in the current economic downturn, the introduction of environmental taxes will not bring negative impacts on economic development. At the same time, we should also recognize the enormous limitations of the green tax. We cannot place the responsibility of environmental protection on the tax of environmental protection.

2. is it necessary to change the environmental protection tax to the historical progress?

In China's history, there has been a phenomenon of "tax squeeze" and "cost exceeding tax". After more than ten years of reform, this situation has changed greatly. At present, the vehicle purchase tax levied in China is changed from vehicle purchase fee, and the consumption tax also includes fuel tax which is changed from road maintenance fee. From the practice of fee to tax reform, fee to tax is a historic improvement. Because the level of tax legislation is higher, law enforcement is more standardized, and less likely to be interfered by local governments. At present, the main reason for the transformation of China's environmental protection fees is also due to the lack of rigid enforcement of the system and the intervention of local governments and departments. However, judging from the current system design, the effect of changing the tax on environmental protection fees may not necessarily result in a good effect of vehicle purchase tax.

The environmental protection tax law (Draft) authorized the provincial people's Congress to formulate the specific management measures for environmental taxes. This shows that the location of the environmental tax is local tax, and the future collection organ is the local tax bureau. Since the revenue of environmental protection tax belongs to the local government, the collection and management is also the responsibility of the Local Taxation Bureau. At the same time, when the specific amount of tax payable is determined, it is also necessary for the local environmental protection bureau to cooperate. Therefore, in the short term, it is difficult to solve the problem of law enforcement rigidity and local government intervention in the future implementation of the green tax. The law enforcement effect of vehicle purchase tax is better because it belongs to the central tax, and is directly charged by the State Administration of Taxation, which is directly subordinate to the central government. It is difficult for local governments and relevant departments to intervene. Therefore, many local tax bureau officials believe that it is not necessary to change taxes only in order to strengthen the rigidity of law enforcement and reduce local interference.

3. is tax authorities capable of collecting environmental taxes?

The environmental protection tax is a highly technical tax. It is necessary to monitor the discharge of taxpayers, and the tax authorities obviously do not have the technical means and human resources to monitor the discharge of taxpayers. Therefore, the environmental protection bonded law (Draft) will still leave the function of pollutant monitoring, supervision and audit confirmation to the Environmental Protection Bureau. This leads to the collection and management of a tax category, which requires two departments to cooperate with each other. This situation does not exist in the collection and management of other taxes.

Since China still has problems of sectling and sectmentalism, the coordination and cooperation between the Local Taxation Bureau and the Environmental Protection Bureau will inevitably face many legal and practical problems. On the one hand, the ability of the Local Taxation Bureau to levy an environmental tax is not enough, and it needs to be strengthened. On the other hand, because the EPA is in a position of matching levy, its participation in environmental tax collection is not very motivated. This may greatly reduce the enforcement rigidity and efficiency of environmental tax, and increase the cost of collection and administration. In the short term, the effect of environmental tax collection may be much better than that of sewage charges.

Another important issue is the allocation of responsibilities between the Local Taxation Bureau and the Environmental Protection Bureau. Although the performance of the local tax bureau ultimately determines the amount of tax paid by taxpayers, in fact, whether taxpayers pay taxes or how much tax is based on the monitoring data of the EPA. Therefore, if it is illegal to collect taxes against taxpayers, whether it is the responsibility of the local tax bureau or the responsibility of the EPA is a realistic problem which the two departments are concerned about. If the taxpayer disagrees with the tax decision of the Local Taxation Bureau, whether it is to prosecute the Local Taxation Bureau or prosecute the environmental protection bureau is also a question worth studying. These difficult problems are not stipulated in the current environmental tax law (Draft), and the formal law passed by the NPC Standing Committee will not provide a clear definition of this controversial issue. The difficulties in future practice may also be left to the State Council and the Supreme People's court.

4. can environmental tax increase investment in environmental protection funds?

After the change of the environmental protection fee, there is also a problem worthy of attention, that is, the input of environmental protection funds. Many people believe that the state's introduction of green taxes indicates that the state attaches importance to environmental protection. Therefore, after the introduction of environmental taxes, the investment in environmental protection funds will increase greatly. This understanding is actually wrong. Because the current sewage charges are earmarked for special purposes, that is, all of them are included in the special funds for environmental protection. Once the tax is changed, the tax revenue is collects and collects, and there is no problem of earmarked appropriation. That is to say, the future environmental tax is the same as other taxes, and its income should be included in the national unified budget. The amount of environmental expenditure is not directly related to the amount of environmental tax collection, and the two will not be linked. Therefore, levying an environmental tax does not mean that the government will increase the budget for environmental protection.

　　 environmental protection Fee to tax Necessity

Sewage charges in environmental protection is an important economic tool for environmental protection since China's reform and opening up. The system has been implemented since the end of 1979. But in 1980, China did not collect any sewage charges on polluting enterprises in the area, until 1990 only gradually began to levy sewage charges in the whole country. With China's environmental pollution becoming more and more serious, over the past 20 years, China has constantly explored, revised and improved the collection of sewage charges from aspects of system assumption, legal determination, charging pilot, method establishment, and standard reform. But generally speaking, the collection standard and rate of sewage charges are both low and the scope is too narrow. The overall environmental protection tax policy lacks systematicness, resulting in the environmental protection effect is not significant.

The bigger background of environmental tax legislation is the transition from administrative expenses to statutory taxes, and the "fee to tax" revolution is being carried out in other areas of the country. The system of sewage charges has played an important role in the prevention and control of environmental pollution. However, compared with the tax system, there are many problems such as inadequate enforcement of law, interference by local governments and departments. Moreover, because of the local charging items and the different charging standards all over the country, it has also aroused widespread doubts about the implementation of many years' pollution charge system. Under the severe environmental situation and the fact that the existing sewage charges are not standardized, it is imminent to change the tax on environmental protection fees.