Which companies will be subject to green taxes?

The Environmental Protection Tax (Draft for Soliciting Opinions) (hereinafter referred to as the “Draft for Comment”) stipulates that the taxable pollutants (including air pollutants, water pollutants and solid waste) shall be directly discharged into the environment in the China area and other sea areas under its jurisdiction. The enterprises, institutions, and other producers and operators of construction noise, industrial noise, and other pollutants are taxpayers of environmental taxes.

However, enterprises, institutions, and other production and business operators shall discharge their taxable pollutants to urban sewage treatment plants and urban domestic garbage disposal sites established according to law, as well as enterprises, institutions, and other producers and operators who store in facilities and sites that meet environmental protection standards. Or disposal of industrial solid waste, no environmental tax is levied.

Fourteen industries such as thermal power plants focus on monitoring taxpayers

The “Draft for Soliciting Comments” proposes that the environmental protection tax be classified and managed according to the key monitoring (sewage) taxpayers and non-key monitoring (sewage) taxpayers.

The so-called key monitoring (sewage) taxpayers refer to thermal power, steel, cement, electrolytic aluminum, coal, metallurgy, building materials, mining, chemicals, petrochemicals, pharmaceuticals, light industry (brewing, papermaking, fermentation, sugar, vegetable oil processing), textiles Taxpayers in 14 key polluting industries and key monitoring companies in other polluting industries.

According to analysis of the 21st Century Business Herald by Secretary General of the National Chamber of Commerce and Industry Environment Chamber of Commerce, Luo Jianhua, these 14 key pollution industries are the most typical “large emitters” and are mainly high-emission industries with concentrated emission of atmospheric and water pollutants.

CEC Secretary-General Wang Zhixuan analyzed in the 21st Century Business Herald that environmental taxes have little impact on the thermal power industry. On the one hand, the collection standards are basically the same as in the past. On the other hand, the absolute amount of atmospheric pollutants emitted by the thermal power industry has been relatively small.

In addition, the "Draft for Comment" stipulates that the State Council and the people's governments of provinces, autonomous regions, and municipalities directly under the Central Government may increase (adjust) the types of key pollution industries according to the needs of environmental protection.

Four taxation objects

The “Draft for Soliciting Opinions” proposes that the object of taxation of environmental protection tax shall be classified into four categories: air pollutants, water pollutants, solid waste and noise. The specific tax items shall be implemented in accordance with the provisions of the tax amount list.

The scope of the collection of atmospheric pollutants and water pollutants shall be no more than 3 items (5 heavy metal pollutants) in the order of the largest number of pollutant equivalents per pollutant. The provincial people's government may increase the number of taxable pollutants that are subject to environmental taxes at the same discharge outlet based on the special needs of pollutant reduction in the region.

In the tax amount table, water pollutants include a total of 61 pollutants of Type I and Type II pollutants. The classification basis is the Integrated Wastewater Discharge Standard (GB8978-1996). The “Draft for Soliciting Comments” requires that only one chemical oxygen demand (COD), biochemical oxygen demand (BOD5), and total organic carbon (TOC) are collected from the same outlet.

Two situations can double the environmental tax

The standard of taxation stipulated in the “Draft for Comments” is basically the same as the current levy standard for sewage charges. The provincial people's government can take into consideration the environmental carrying capacity of the region, the current status of pollution discharge, and the economic and social ecological development target requirements. The applicable tax amount of taxable pollutants shall be properly increased on the prescribed tax amount standards and submitted to the State Council for the record. Excessive discharge of pollutants in excess of the total amount shall be subject to additional environmental protection taxes. For the collection of environmental taxes in accordance with the provisions of the environmental protection tax law, sewage charges shall no longer be levied.

The "Draft for Comment" stipulates that companies will be doubled in environmental taxes in the two cases of excessive emissions.

Specifically, when the pollutant discharge concentration value is higher than the national or local pollutant discharge standard, or if the pollutant discharge is higher than the specified total emission quota, the local applicable tax amount standard shall be doubled.

In another case, the pollutant emission concentration value is higher than the national or local pollutant discharge standards. If the pollutant discharge volume is higher than the specified total emission quota, the local applicable tax amount standard shall be 3 times of the levy.

At the same time, the “Draft for Comment” also stipulates the “discounting” of environmental taxes. Where the concentration of taxable emissions of atmospheric pollutants and water pollutants of taxpayers is lower than 50% of the national or local pollutant discharge standards, and the total amount of pollutant discharge control targets have not been exceeded, the people’s governments of provinces, autonomous regions, and municipalities may decide The environmental tax will be reduced by half within a certain period of time.

Exemption from environmental taxes

At the same time, the "Draft for Comments" proposes that the State Council may formulate special preferential policies for environmental protection taxes in accordance with the special needs of the public interest or respond to major emergencies, and report them to the Standing Committee of the National People's Congress for the record.

Taxpayers are exempted from environmental tax relief scenarios, including taxable pollutants emitted from agricultural production (excluding large-scale farming); taxable pollutants emitted by mobile sources such as motor vehicles, railway locomotives, non-road mobile machinery, ships, and aircraft. Urban sewage treatment plants and municipal solid waste disposal sites discharge pollutants to the environment, which do not exceed the national emission standards.

Among them, the taxation of pollutants from motor vehicles and other vehicles is exempted from environmental taxes. Ge Chazhong, director of the Ministry of Environment and Planning of the Ministry of Environmental Protection, analyzed the 21st Century Business Herald. “There is a difficulty in the verification of pollutant emissions from vehicles. The reasons for this are also the reasons for the existence of tax items such as travel tax and fuel tax for transport."

How companies pay green taxes

The "Draft for Comment" stipulates that taxpayers should apply for the payment of environmental taxes to the competent taxation authorities of the place where the taxable pollutants are discharged.

Environmental protection tax is levied on a monthly, quarterly, or yearly basis and is determined by the competent tax authority according to actual conditions. If the tax cannot be calculated for a fixed period of time, tax may be reported on a regular basis.

According to the “Draft for Comment”, the taxpayer shall submit tax declarations and pay tax to the competent tax authority within 15 days from the date of expiry of the tax period.

As far as the contents of the declaration are concerned, there is a great difference between the key monitoring (sewage) companies and non-key monitoring (sewage) companies. Among them, the key monitoring (sewage) taxpayer's declaration of the type, quantity, etc. of taxable pollutants discharged by the competent tax authority shall be submitted to the competent department of environmental protection within 5 days from the date of expiry of the tax payment period, and the competent department of environmental protection shall receive a report from itself. Within 30 days from the date of the data, the company shall issue an audit opinion to the competent tax authority.

The application materials of non-key monitoring (sewage discharge) taxpayers shall be jointly verified and announced by the competent tax authority in conjunction with the competent department of environmental protection. The specific measures are stipulated by the people's governments of provinces, autonomous regions and municipalities.

At the same time, if a tax-paying enterprise engages in marine engineering projects and discharges taxable atmospheric pollutants, water pollutants, and solid waste into the seas under China's jurisdiction, it shall apply for payment of environmental protection taxes in accordance with the relevant provisions of this Law. The specific tax declaration matters shall be stipulated by the competent taxation department of the State Council in conjunction with the marine department.

In addition, if a tax-paying company fails to report and pay taxes to the tax authorities as required, it will be subject to corresponding penalties in accordance with the provisions of the Tax Collection Administration Law, the Environmental Protection Law, and relevant laws and regulations.

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