GTAP Resources: Resource Display
| GTAP Resource #6002 |
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"Impacts of Potential China's Environmental Protection Tax Reforms on Provincial Air Pollution Emissions and Economy" by Hu, Xiurong, Junfeng Liu, Haozhe Yang, Jing Meng, Xuejun Wang, Jianmin Ma and Shu Tao Abstract China's environmental protection tax (EPT) has been implemented since the beginning of 2018 to control environmental issues (e.g., air pollution). The current EPT law indicates that tax revenues are given to provincial governments without return. However, tax revenue redistribution is the key to achieving a so-called “double dividend”; that is, an environmental tax could benefit both the environment and economic efficiency. Based on our previous analysis of the effectiveness of the current EPT, we further explore whether the double dividend could be achieved under different tax reforms based on the multiregion and multisectoral computable general equilibrium model. We find that recycling the EPT revenue to reduce household income tax (EPT_Int) is an efficient way to achieve the double dividend, and there is no double dividend if the EPT revenue is compensated by reducing enterprise income tax (EPT_Ent) or by investing in solar power (EPT_Sol). Combining EPT_Int and EPT_Sol could be a better approach if more air pollution emissions reductions are required to achieve the national reduction targets. At the provincial level, recycling the EPT revenues to reduce household income tax could offset the negative effect of environmental tax on the economy and achieve the double dividend in all provinces, especially the provinces with higher emission intensity, such as Shanxi, Hebei, Inner Mongolia, and Guizhou Provinces. This result shows that provinces with high emission intensity may further reduce air pollutant emissions during the post-EPT era. |
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- Dynamic modeling - Asia (Southeast) |
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If you have trouble accessing any of the attachments below due to disability, please contact the authors listed above.
Public Access  Paper (4.8 MB) Replicated: 0 time(s) Presentation (3.1 MB) Replicated: 0 time(s)Restricted Access No documents have been attached. Special Instructions No instructions have been specified. |
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Last Modified: 9/15/2023 2:05:45 PM
