With the signature and approval of Premier Li Keqiang, the State Council recently issued the notice on the attribution of environmental protection tax revenue (hereinafter referred to as the notice), which specifies that environmental protection tax is local revenue.

The notice points out that the environmental protection tax law of the people's Republic of China will come into effect on January 1, 2018. According to the provisions of this law, enterprises, institutions and other producers and operators that directly discharge taxable pollutants into the environment within the territory of the people's Republic of China and other sea areas under the jurisdiction of the people's Republic of China are taxpayers of environmental protection tax and shall pay environmental protection tax according to law. In order to promote local protection and improvement of the environment and increase investment in environmental protection, the State Council has decided that all environmental protection taxes shall be regarded as local income.

As the official date of levying environmental protection tax on January 1, 2018 approaches, the relevant preparation for collection and management has come to an end. Recently, various localities have announced detailed tax rates within the scope of optional tax rates for air and water pollutants. The Beijing Tianjin Hebei region has adopted a higher tax rate, of which the Beijing top grid implementation has adopted a higher tax rate, and the 13 counties in Hebei Province around Beijing have also adopted a higher tax rate.

According to the regulations, the legally established urban and rural centralized sewage treatment and domestic garbage treatment sites that discharge taxable pollutants into the environment in excess of the national and local discharge standards shall pay environmental protection tax. Enterprises, institutions and other producers and operators that store or dispose of solid wastes that do not meet the national and local environmental protection standards shall pay environmental protection tax.

Relevant policies: Notice on the attribution of environmental protection tax revenue