BEIJING, May 9 (UPI) -- A Chinese government official has signaled that tougher taxes on the use of resources and on emissions would be imposed so the country can achieve greener industrial development.
Writing in China's Qiushi magazine, Vice Premier Ma Kai called for an increase in funds needed to tackle pollution "via taxation measures."
"We will continue to push forward a pricing mechanism by soliciting opinions from multiple parties, including government, enterprises and consumers," he said.
Ma also called for more use of renewable energy such as hydro and nuclear power and suggested an escalating scale for electricity charges, with higher charges imposed for excessive users.
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China introduced a round of reforms in November in which the resources tax for oil and gas moved from volume-based to a value-based tax, set at 5 percent of the value of the oil and gas produced. China National Offshore Oil Corp. in its 2012 annual report said the revised tax policy increased oil production costs by nearly 17 percent per barrel.
But those reforms didn't include coal, which is still taxed by volume and accounts for about 70 percent of the country's energy generation. In March the government set a target to cap coal consumption to 4 billion tons by 2015.
Jia Kang, director of the Research Institute of Fiscal Science at the Ministry of Finance, told China Daily the introduction of an all-encompassing resource tax that includes coal would be a "tough fight," although it would force factories to restrict excessive production and adopt more energy-saving technologies.
While there are no exact details about a possible coal tax, analysts say the government likely would follow the oil and gas model and introduce a value-based tax of about 5 percent on coking and thermal coal.
"Implementing a value-based resources tax on coal would have a huge impact on coal and energy prices, so it's a question of whether the economy can withstand that change," Yang Zongxing, an analyst with Donghai securities in Shanghai, was quoted as saying by the Financial Times.
As for emissions, regional pilot emissions trading schemes will soon begin in five cities, including Beijing, Shanghai and Shenzhen and in the provinces of Guangdong and Hubei. Together, the areas cover a population of more than 250 million people.
Shenzhen is scheduled to be the first to begin, on June 17. Shanghai has also said it will launch in June, although no date has been set.
The world's largest emitter of carbon dioxide, China has pledged a 17 percent cut in its emissions per unit of economic output by 2015, compared with 2010 levels.
