China’s Environment Tax Comes due in April

In April of this year, more than 260,000 companies and organizations in China will have to begin paying an environment tax, as the government moves to restrict pollution and protect the environment.

The new Environmental Protection Tax Law (EPT law) went into effect on Jan. 1. As China mandates quarterly tax returns, the tax will have to be paid retroactively for the period January-March.

Under the plan, those that discharge listed pollutants directly into the environment will have to foot the bill for producing noise, air and water pollutants as well as solid waste. Tax obligations will accrue from the date of discharge.

China's first-ever tax directed at anchoring environmental protection in the corporation consciousness also is designed to help establish a “green’ financial and taxation system and promote pollution control and treatment of pollutants.

With the introduction of the new tax, the government has ended the “pollutant discharge fee” it has collected since 1979.  Reports list chemical producers as being among the eight groups that have paid the highest level of pollutant discharge fees in the past.

According to the website xinhuanet.com, China has offered training to over 70% of the more than 260,000 taxpayers, as well as streamlined declaration procedures to ensure that the first collection period runs smoothly.

In reaction to severe air pollution in northern and central China, Beijing this winter restricted the burning of coal and promoted the use of natural gas. This led to periodic shortages of gas to heat homes and well as liquefied natural gas used by chemical production facilities.