The Chinese Ministry of Finance has proposed a carbon tax for China, starting at 10 yuan ($US1.59) per tonne, starting in 2016. This is much lower than the Australian and European carbon prices and there appear to be no proposals to move to a market mechanism, as the case with Australia and Europe. However, like Australia, the proposal is to gradually increase the price, to lessen concerns over its effect on economic development. As with Australia, the tax is proposed to be revenue neutral, with other forms of taxes being reduced. Many of the students in my course "ICT Sustainability: Assessment and Strategies for a Low Carbon Future" are from China and the carbon price is likely to see an increase in interest in how to reduce energy use and therefore cost and carbon emissions.
... The main targets of the tax will be large users of coal, crude oil and natural gas, and tax cuts will be given to companies that take steps to reduce their emissions, Su said.Jiang Kejun, a researcher with the National Development and Reform Commission's Energy Research Institute, who helped draft the tax proposal, said the tax is likely to be collected only from producers and wholesalers of fossil-fuel based energy. This will make it easier to collect the tax. ...
Source: China Daily 2012-1-6
From: "Officials weighing green benefits of carbon taxation", Climate Change Info-Net, Department of Climate Change, National Development and Reform Commission, China, 5 January 2012
... Deputy Director, Institute of Fiscal Science, 21 Su Green Economic Outlook Forum in China, said that next year in a proactive fiscal policy, strategic and emerging industries, especially for low-carbon industry "to implement a more active fiscal policy", including investment subsidy, interest subsidy, equity investments, financial support guarantees, government procurement, taxation and other means of six.
Su said the investment subsidies from production areas to consumption areas, but the production processes of investment grants will not be canceled.
The so-called "investment grants" refers to the central budget (including the bond project funds) arrangements, given the special conditions of investment in fixed assets in line with project funds.
Discount in financial terms, which will guide financial institutions to promote low-carbon industries.
The so-called "financial discount" refers to the government on behalf of the company to pay part or all of the interest on loans, indirect subsidies to businesses to provide cost price.
Security aspects of the financial support, financial and social capital can be guaranteed a joint venture company, or create a security risk compensation.
Means of taxation, from 2012, the strategic emerging industries, especially for low-carbon industries, is expected to start the enterprise income tax incentives, both tax relief and other direct means, but also including investment credits and other indirect means.
The so-called "investment credits" refers to the taxpayer in the territory of the government to encourage investment projects that allow for the amount of investment, some or all of the income tax credit amount.
"According to the amount of investment for the purchase of equipment credits."
Su explained that most of the strategic emerging industries also are "low-carbon industry" category.
To ensure high-carbon industries to low-carbon industry's economic structure adjustment, Su said, the carbon tax is expected in the "five" post-levy, tax base, including coal, crude oil, natural gas and other greenhouse gas emitters, from 10 per tonne of carbon dioxide lower rate of $ start, the rate gradually increased.
However, Su believes that next year's economic growth is slowing down, coupled with the structural pushing tax cuts for SMEs, the introduction of a carbon tax is not a good time.
Financing for low-carbon industry status quo, Central University of Finance Climate and Energy Center for Financial Research Renwang Yao told reporters that China's low carbon financing mainly in the United Nations Clean Development Mechanism (CDM) mechanism inflows, inflows of multilateral development institutions foreign-based private sector capital inflows, but domestic financing was started, still dominated central government grants and subsidies, sovereign wealth funds, government guidance funds, green financial services is still in the initial operational phase.
Beijing Science and Technology Co., Ltd. in creating carbon investment money Guoqiang, director of strategy to reporters concluded that fiscal policy can only "emergency blood transfusion", play a stimulating social capital leverage.
But to establish a long-term financing to solve the mechanism of low-carbon industries, based on two premises: First, have a carbon asset prices, wind power, hydropower and other new energy companies and carbon capture carbon and other high-tech enterprises can sell out; two to implement mandatory carbon emissions, so that the quota of carbon emissions than spend money on corporate carbon.
In addition, companies can also explore carbon for carbon asset mortgages.
National Development and Reform Commission in response to climate change-related work in the record, Deputy General Manager Zheng Xipeng carbon investment, said a large number of low-carbon technologies into the research and development only after the paper published, the market can not be achieved; many local governments to implement the demonstration project, demonstration zone is difficult to promote the country.
"This is because the lack of a bridge - the business model, otherwise, rely on policy, funding, technology, pile, heap is not a mature market," Zhengxi Peng said.
From: "Idea of financial support for low carbon industries emerge" (translation of 低碳产业财政扶持思路浮出水面), Economic Information Daily, Ministry of Commerce, China, 15 December 2011
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