Hazy future for pollution tax

• Source: Global Times
• [21:20 June 18 2009]
• Comments

Cyclists passed through thick pollution from a factory in Yutian, 100 kilometers east of Beijing in North China’s Hebei Province. Photo: ImagineChina

By Sun Zhe

A man was caught spitting on the sidewalk and fined 50 yuan ($14.64). The guy took a 100-yuan note out of his pocket, handed it to the cop and said, “Keep the change. I want to do it again.”

The joke mirrors the doubt that the environment taxation issue has triggered. Would it really ease pollution, or it is just a government money maker?

A two-year history

Vice Finance Minister Wang Jun said on June 11 that the Ministry of Finance was considering the environmental taxation issue.

In saying that Wang was echoing his counterpart in the Ministry of Environmental Protection (MEP), Zhang Lijun, who said on June 5 that eco-taxation has been put on the schedule of “significant issues,” and was being pondered by Ministry of Finance, the State Administration of Taxation (SAT) and the MEP.

It’s not the first time that heads of the state environment bureau has brought up the issue.

It was noted in an emissions reduction schedule released as early as June 2007, when the National Development and Reform Commission stated that China was going to tax polluters. The MEP – then the State Environmental Protection Administration, which was upgraded to ministry level in March 2008 to highlight the government’s eco-consciousness – had declared at the time that an environment tax was being discussed.

However, in June Zhang and Wang, like their predecessors, did not give a timetable for any eco-tax.

Environment destruction has accompanied China’s GDP rush for years. Heavy air pollution chokes in one third of the country’s cities, more than one fourth of its rivers and lakes are contaminated by industrial waste, and 90 percent of its rivers crossing urban areas are heavily polluted, according to a February working session of the MEP in Shanghai.

“The government would always weigh whether the employment and the GDP that one industry created was really worth the harm, or pollution, it causes,” said Fan Yong, dean of the taxation department with the Central University of Finance and Economics in Beijing, “That is one reason pollution tax is being brought forward now.”