Environmental Protection Tax Law

(Adopted at the 25th Session of the Standing Committee of the 12th National People's Congress on December 25, 2016; and amended according to the Decision of the Standing Committee of the National People's Congress to Amend Fifteen Laws Including the Law of the People's Republic of China on the Protection of Wild Animals at the Sixth Session of the Standing Committee of the 13th National People's Congress of the People's Republic of China on October 26, 2018)
 
Chapter I General Provisions
 
Article 1 This Law is formulated in order to protect and improve the environment, reduce pollutant emissions and promote the construction of ecological civilization.
 
Article 2 Enterprises, institutions and other producers and operators directly discharging taxable pollutants into the environment in the territory of the People's Republic of China and other sea areas under the jurisdiction of the People's Republic of China shall pay environmental protection tax in accordance with the provisions of this Law.
 
Article 3 The term "taxable pollutants" as mentioned in this Law refers to atmospheric pollutants, water pollutants, solid wastes and noise specified in the Tax Items and Tax Quotas for Environmental Protection and the Taxable Pollutants and Equivalents Table attached to this Law.
 
Article 4 Under one of the following circumstances, pollutants discharged directly into the environment are not included, and corresponding environmental protection taxes on pollutants are not paid:
(1) Enterprises, institutions and other producers and operators discharge taxable pollutants into centralized sewage treatment and domestic waste treatment sites established in accordance with law;
(2) Enterprises, institutions and other producers and operators store or dispose of solid waste at facilities and sites that meet the national and local environmental protection standards.
 
Article 5 If a legally established centralized sewage treatment and domestic waste treatment site discharges taxable pollutants into the environment beyond the discharge standards prescribed by the state and local governments, environmental protection tax shall be paid.
Enterprises, institutions and other producers and operators that store or dispose of solid waste do not meet the national and local environmental protection standards shall pay environmental protection tax.
 
Article 6 The items and amounts of environmental protection tax shall be executed in accordance with the Table of Taxes and Items of Environmental Protection Tax attached to this Law.
The determination and adjustment of the specific applicable tax amount for taxable air pollutants and water pollutants shall be made by the people's governments of provinces, autonomous regions and municipalities directly under the Central Government, taking into account the environmental carrying capacity, pollutant discharge status and the requirements of economic, social and ecological development objectives in the region as a whole, within the scope of the tax amount specified in the Tax Table of Environmental Protection Taxes attached to this Law, and submitted to the standing members of the People's Congress at the same level The decision shall be submitted to the Standing Committee of the National People's Congress and the State Council for the record.
 
Chapter II Tax Basis and Taxable Amount
 
Article 7 The basis for taxable pollutants shall be determined according to the following methods:
(1) Taxable atmospheric pollutants shall be determined according to the equivalent number of pollutants discharged in the same way as the equivalent amount of pollutants discharged;
(2) The taxable water pollutants shall be determined according to the equivalent number of pollutants discharged by the pollutants.
(3) Taxable solid waste shall be determined according to the discharge amount of solid waste;
(4) The taxable noise shall be determined in decibels exceeding the standards prescribed by the State.
 
Article 8 The pollution equivalent of taxable air pollutants and water pollutants shall be calculated by dividing the discharge amount of such pollutants by the pollution equivalent value of such pollutants. The specific pollution equivalent values of each taxable air pollutant and water pollutant shall be implemented in accordance with the Table of Taxable Pollutants and Equivalents annexed to this Law.
 
Article 9 Taxable atmospheric pollutants at each discharge port or without discharge port shall be levied environmental protection tax on the first three pollutants according to the order of pollution equivalent from large to small.
Taxable water pollutants at each discharge outlet shall be distinguished from the first water pollutants and other water pollutants according to the Taxable Pollutants and Equivalent Value Table attached to this Law. Environmental protection tax shall be levied on the first five categories of water pollutants according to the order of pollution equivalents from large to small, and environmental protection tax shall be levied on other categories of water pollutants according to the first three categories.
The people's governments of provinces, autonomous regions and municipalities directly under the Central Government may increase the number of items of taxable pollutants levied on environmental protection tax at the same discharge port in accordance with the special needs of pollutant emission reduction in the region, and report them to the Standing Committee of the People's Congress at the same level for decision, and to the Standing Committee of the National People's Congress and the State Council for record.
 
Article 10 The decibels of emissions of taxable atmospheric pollutants, water pollutants, solid waste and noise shall be calculated according to the following methods and sequence:
(1) Taxpayers who install and use automatic monitoring equipment for pollutants that conform to the state regulations and monitoring standards shall calculate according to the automatic monitoring data of pollutants;
(2) If the taxpayer does not install and use automatic monitoring equipment for pollutants, the calculation shall be based on the monitoring data issued by the monitoring agencies that conform to the relevant regulations and monitoring norms of the State;
(3) If the monitoring conditions are not met due to various types of pollutants discharged, the calculation shall be based on the discharge coefficient and material balance method prescribed by the competent department of ecological environment under the State Council;
(4) If the calculation cannot be carried out according to the method specified in Items 1 to 3 of this Article, the calculation shall be checked and approved according to the sampling method prescribed by the competent department of ecological environment of the people's governments of provinces, autonomous regions and municipalities directly under the Central Government.
 
Article 11 The taxable amount of environmental protection tax shall be calculated according to the following methods:
(1) The taxable amount of taxable atmospheric pollutants is the pollution equivalent multiplied by the specific applicable tax amount;
(2) The taxable amount of the taxable water pollutants is the pollution equivalent multiplied by the specific applicable tax amount;
(3) The taxable amount of taxable solid waste is the discharge amount of solid waste multiplied by the specific applicable tax amount;
(4) The taxable amount of taxable noise shall be the specific applicable tax amount corresponding to the decibel number exceeding the national standard.
Chapter III Tax Relief
 
Article 12 Under the following circumstances, environmental protection tax shall be temporarily exempted:
(1) Emissions of taxable pollutants from agricultural production (excluding large-scale farming);
(2) Taxable pollutants are discharged from mobile pollution sources such as motor vehicles, railway locomotives, off-road mobile machinery, ships and aircraft;
(3) The discharge of taxable pollutants from centralized treatment sites for urban and rural sewage and domestic waste established according to law does not exceed the discharge standards prescribed by the state and local governments;
(4) Solid waste that taxpayers comprehensively utilize meets the national and local environmental protection standards;
(5) Other circumstances in which the State Council approves tax exemption.
The fifth exemption provision of the preceding paragraph shall be submitted by the State Council to the Standing Committee of the National People's Congress for the record.
 
Article 13 Where the concentration value of taxable air pollutants or water pollutants discharged by taxpayers is less than 30% of the pollutant discharge standards prescribed by the state and local governments, the environmental protection tax shall be levied at a reduced rate of 75%. If the concentration value of taxable air pollutants or water pollutants discharged by taxpayers is lower than 50% of the pollutant discharge standards prescribed by the state and local governments, the environmental protection tax shall be levied at a reduced rate of 50%.
 
Chapter IV Administration of Collection
 
Article 14 Environmental protection tax shall be levied and administered by tax authorities in accordance with the Tax Collection and Administration Law of the People's Republic of China and the relevant provisions of this Law.
The competent department of ecological environment shall be responsible for the monitoring and management of pollutants in accordance with the provisions of this Law and relevant laws and regulations on environmental protection.
Local people's governments at or above the county level shall establish a mechanism for division of labour and cooperation among tax authorities, competent ecological environment departments and other relevant units, strengthen the collection and management of environmental protection taxes, and ensure timely and full storage of taxes.
 
Article 15 The competent departments of ecological environment and tax authorities shall establish tax-related information sharing platforms and working cooperation mechanisms.
The competent department of ecological environment shall regularly submit to the tax authorities relevant information on environmental protection, such as discharge permits, pollutant discharge data, environmental violations and administrative penalties of the pollutant discharging units.
Tax authorities shall regularly submit tax-related information on environmental protection tax such as taxpayers' tax declarations, tax deposits, tax deductions and exemptions, tax arrears and risk doubts to the competent department of ecological environment.
 
Article 16 The occurrence time of tax obligation shall be the day on which taxpayers discharge taxable pollutants.
 
Article 17 Taxpayers shall declare and pay environmental protection tax to the tax authorities of the places where the taxable pollutants are discharged.
 
Article 18 Environmental protection tax shall be calculated monthly and paid quarterly. If the payment cannot be calculated within a fixed period of time, it may be declared and paid on a time-by-time basis.
When a taxpayer declares and pays his taxes, he shall report to the tax authorities the types and quantities of taxable pollutants discharged, the concentration values of air pollutants and water pollutants, and other tax data that the tax authorities require the taxpayers to submit according to actual needs.
 
Article 19 Where a taxpayer declares and pays his taxes on a quarterly basis, he shall, within 15 days from the end of the quarterly period, file his tax return with the tax authorities and pay his taxes. Where a taxpayer declares and pays the tax in a timely manner, he shall, within 15 days from the date of the occurrence of the duty of paying taxes, file the tax return with the tax authorities and pay the tax.
Taxpayers shall handle tax declaration truthfully according to law and bear responsibility for the authenticity and integrity of the declaration.
 
Article 20 Tax authorities shall compare the taxpayer's tax return data with the relevant data submitted by the competent department of ecological environment.
If a tax authority finds that the taxpayer's tax declaration data are abnormal or that the taxpayer fails to file the tax declaration within the prescribed time limit, it may request the competent department of ecological environment to conduct a review. The competent department of ecological environment shall issue a review opinion to the tax authority within 15 days from the date of receiving the data of the tax authority. Tax authorities shall adjust taxpayers' tax payable according to the data reviewed by the competent department of ecological environment.
 
Article 21 Where the amount of pollutants discharged is approved and calculated in accordance with the provisions of Item 4 of Article 10 of this Law, the types, quantities and taxable amounts of pollutants discharged shall be approved by the tax authorities in conjunction with the competent departments of ecological environment.

Article 22 The specific measures for taxpayers to declare and pay environmental protection tax when discharging taxable atmospheric pollutants, water pollutants or solid wastes into the sea areas under the jurisdiction of the People's Republic of China from marine engineering shall be formulated by the competent tax department under the State Council in conjunction with the competent ecological environment department under the State Council.
 
Article 23 Where taxpayers and tax authorities, competent ecological environment departments and their staff violate the provisions of this Law, they shall be investigated for legal liability in accordance with the Tax Collection and Administration Law of the People's Republic of China, the Environmental Protection Law of the People's Republic of China and relevant laws and regulations.

 
Article 27 From the date of implementation of this Law, environmental protection tax shall be levied in accordance with the provisions of this Law, and no pollution discharge fee shall be levied.
 
Article 28 This Law shall come into force on January 1, 2018.