Low-carbon Strategy in China: from the low-carbon Industry Park to the Low-carbon

Financial and Tax Polices

Prof. Xu Zhengzhong Chinese Academy of Governance Prof. Xu Zhengzhong Chinese Academy of Governance

Secretary General, China Public Economic AssociationSecretary General, China Public Economic Association

Low-carbon Development Models based on Different Driving Forces in ChinaTechnology-led model T (Model T).

Project-led mode1 P (Model P)..

Enterprise-led models (Model E).

Non-governmental organizations-led model (Model N)

Capital-driven model (model CT)

Consume-guide model (Model CG)

Government-driven model (Model G)

Legally-bound model (Model L)

Low-carbon Economy Models Based on Different Targets

low-carbon city model, low-carbon industry model carbon sequestration model.

Th

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tatio

ns

Electricity

Heat

AshM

EL

ICS

EA Recycle

d water

Waste residue

Waste Water

Sew

age T

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Domestic water

Gangue Fly Ash AeolianInflammableWaste

Waste gas Waste gas

Eco-system

Economic system

Electricity Heating

Low-carbon Economic System

Low-carbon Economic Development Strategies

Low-carbon System

Low-carbon Culture

Energy Policy

Industry Policy

Market Policy

ConsumptionPolicy

TechnologyPolicy

Management Policy

New energyEnergy structure

High energy efficiency

Energy conservation and Emission reductionLow carbon energy

Emerging Industry Industry structureLow-carbon agricultureLow-carbon industry policyLow-carbon service industry

Market accessCarbon exchangeLow-carbon tax and financeEco-compensationEco-financial PolicyLow-carbon price

Consumption Guidance Consumption environmentConsumption Demand Green ConsumptionLow-carbon lifestyle

New energy TechnologyEnergy conservation and emission reductionCarbon absorptionTechnical cooperationTechnical Standard

Tax and fiscal policies provide the starting power

Financial innovation provides continuous momentum

Energy ContractLow-carbon evaluationLow-carbon incentivesLow-carbon controlLow-carbon pilot

Horizontal Implementing Policy Chain

Horizontal Basic Policy Chain

Policy Core

Policy Base

Construction of Low-Carbon Economic Policy Chain

Tax Category Adjustment

Resource tax （ 1 ） Enlarge taxation scope to cover to resources, such as land, sea, forest, geothermal resource, etc. （ 2 ） Appropriately Increase tax rates of some resource taxes, especially for these that are under key protection and are prohibited in exploitation. （ 3 ） Adjust current tax base. Eg. Output-based assessment should be replaced by recoverable reserves to encourage resource recovering.

Consumption tax

（ 1 ） Enlarge taxation scope to cover products that are with high energy consumption and high carbon emissions and fail to meet energy conservation standards.（ 2 ） Develop differentiated tax rate. Tax rate should be based on energy consumption and carbon emission. Current tax level of some consumer goods need to be adjusted, Eg increase the tax rate of high-emission cars, while lower that of low-emission cars and motorcycles（ 3 ） Consider collecting oil consumption tax to improve public awareness on energy serving and environmental protection.

Value-added tax(VAT)

（ 1 ） Offer VAT deduction to key energy-saving equipment and products to remove their price constraints within a given period of time. （ 2 ） Remove tax reduction on toxic pesticide and agricultural plastic film.

business tax (1) Exempt business tax of institutes, organizations and individuals that get incomes from technical transfer, consultation, and service in energy-saving, emission reduction, renewable energies R&D to encourage the dissemination and utilization of energy-saving technologies.

income tax （ 1 ） Increase the pre-tax deduction rate of R&D funds for energy-saving equipment and products （ 2 ） Apply the accelerated depreciation to some special equipment for producing energy-saving products. （ 3 ） Deduct or exempt income taxes of enterprises that purchased and installed equipment for producing energy saving products.（ 4 ） Exempt or reduce income tax of institutes and individuals who receive income from low-carbon oriented technical services including technical transfer, training, consultation, service, and outsourcing.

tax on buying vehicles

(1) Give appropriate tax preference to clean energy or new energy vehicles.

vehicle and vessel tax

(1) Adjust the base of vehicle and vessel tax. There should be different threshold for vehicle and vessels with different energy consumption levels and gas emission.

tariff （ 1 ） Impose tariff or environmental tariff on imported equipment with high energy consumption and carbon emission. (2) Impose tariff or environmental tariff on primary or semi-manufactured goods which consume large amount of domestic natural resources and cause little or no pollution in the destination countries.

谢谢大家！Thanks

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