Image: © John E. Williamson
Not long after reports of China’s unearthly pollution dominated headline news, the Ministry of Finance has published plans to tax carbon emissions. The idea of a carbon tax is not new in China, but the secretary of tax administration Jia Chen has now drawn up a comprehensive document that promises, among other things, to promote sweeping environmental tax reform and include carbon dioxide emissions within its scope.
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Experts are waiting to see if and how well existing cap and trade pilot projects will coincide with the new carbon tax, according to Responding to Climate Change (RTCC), but most agree that some kind of action must be taken to curtail the unfettered release of toxic pollutants into the country’s atmosphere.
“Further regulation of CO2 could help to address current air pollution challenges if the environmental protection tax includes a range of pollutants, or if facilities curbing emissions through means that end up reducing other pollutants as well,” Joanna Lewis, assistant professor at Georgetown University told RTCC.
Globe International’s Terry Townshend sees the news as an internal dialogue about how to divvy up the funds generated by emissions trading schemes and a carbon tax, which would be handled by two different ministries – namely the National Development and Reform Commission and the Finance Ministry. But the most important thing, he said, is to put a price on carbon. “Whether that is via a tax or through ‘cap and trade’ is secondary.”