Addressing the competitiveness effects of taxing carbon in China: domestic tax cuts versus border tax adjustments

Liang, Qiao‐Mei; Wang, Tao; Xue, Meimei

doi:10.1016/j.jclepro.2015.02.092

Cited by 57 publications

(20 citation statements)

References 35 publications

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“…All these atmospheric pollutants mainly come from the usage of fossil energy. In 2010, there were 8.29 billion tons of carbon dioxide, 21.85 million tons of sulfur dioxide, and 18.52 million tons of nitrogen oxide emissions.…”

Section: Introductionmentioning

confidence: 99%

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The Impacts of Environmental Tax in China: A Dynamic Recursive Multi-Sector CGE Model

et al. 2015

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Abstract:In recent years, the accumulated environmental problems resulting from excessive usage of fossil fuels have gradually loomed. Thus, an environmental tax, as an important policy tool, has been put on the agenda in China. In this paper, a dynamic recursive multi-sector Computable General Equilibrium (CGE) model is applied to explore the impacts of the environmental tax on China's economy. To comprehensively analyze the impacts, we introduce four kinds of typical contaminants and set two kinds of scenarios: different tax rates and different tax refunds. The results show that the environmental tax is conducive to environmental improvement, but the economic variables are adversely affected, for example, the loss of GDP at the low level tax rate is 0.46%. In order to offset the negative impacts, we presume the government refunds the tax. The results show that this can indeed relieve the negative effects. When the government refunds the production tax and corporate income tax, 0.49% and 0.34% of GDP is relieved by respectively. This paper provides a comprehensive analysis of the implementation of the environmental tax in China and lays a solid foundation for the introduction of the environmental tax.

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Section: Introductionmentioning

confidence: 99%

“…Only valuing the tax rate or emission reduction is no longer enough, and they began to consider the concept of "tax neutrality". The most common way to use the environmental tax is to recycle the tax revenue, which, to some extent, can avoid some negative impacts and also can relieve the distortion of the tax [19][20][21][22][23][24][25].…”

Section: Introductionmentioning

confidence: 99%

The Impacts of Environmental Tax in China: A Dynamic Recursive Multi-Sector CGE Model

et al. 2015

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“…However, this methodology is based on the assumption that If a tax on the amount of emitted CO 2 equivalent were charged in the productive sectors, the tax vector (T) would be defined as Equation 10, where R is the rate per tonne of CO 2 equivalent from using fossil fuel given that τ 0 = T 0X − 1 . The adjusted price vectorp is then represented as Equation 11,…”

Section: Price Structure Path and Price Changementioning

confidence: 99%

Fossil fuel carbon taxation policy effect on thai household expenditure using input–output price structural path model

Phungrassami

Usubharatana

2019

Env Prog and Sustain Energy

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Taxation levying promotes and enhances the management of greenhouse gas emissions; however, its effect on product price increases for households requires clarification. The impact of a fossil fuel taxation policy on Thai household expenditure was investigated. Carbon taxation rate was based on abatement cost. An input–output price model was applied to establish economical price structures and price changes as a carbon result of implementing a carbon taxation policy. A national consumer expenditure survey and price changes were used to evaluate the carbon tax burden distribution on each households, which have different expenditure. By using marginal abatement cost curve, reduction target is 175 MtCO2e by 2030. Results indicated that achieving the reduction target by that time is possible, although welfare losses in households were inevitable. Price increases resulting from implementing carbon taxation in each product sector ranged from 0.8 to 19.6%. Commodity price changes were largest for high carbon‐intensive sectors including Public utilities (19.6%), Nonmetallic products (15.7%), and Transport & Communication (8.5%). Welfare losses per household from taxation were around 3–4% for each group, resulting from both price changes and expenditure patterns. Highest tax burden fell on the economically inactive group that spent a larger share of their income on basic survival essentials which were heavily impacted by increased prices. © 2019 American Institute of Chemical Engineers Environ Prog, 38:e13146, 2019

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“…However, considering that China's responses to carbon tariffs is seldom mentioned in the existing literature, Liang et al [38], Dissou and Karnizova [39], Eyland and Zaccour [40], Dong et al [41], and Qu and Wu [42] compared the different impacts of a carbon tariff and carbon tax, but did not take a carbon tariff as a response policy. However, the researches of Zhu [43] and Jiang [44] are similar to our study.…”

Section: Literaturementioning

confidence: 99%

Impacts of U.S. Carbon Tariffs on China’s Foreign Trade and Social Welfare

Zhang

et al. 2019

Sustainability

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A recursive multisector dynamic computable general equilibrium (DCGE) model simulates the economic impacts of carbon tariffs, as proposed by the USA, ranging from $40/t to $60/t CO2. We examine a carbon tax and export subsidy as response policies to the U.S. carbon tariff, respectively. The dynamic model shows the possible impacts of these policies on China’s economic structure, carbon emissions, and social welfare from 2020 to 2030. Simulations show that a carbon tariff changes the structure of China’s exports and promotes trade diversion from the USA to other countries and regions. A domestic carbon tax and subsidy policy can dampen the adverse impacts of carbon tariffs on trade. A carbon tax shows an effective impact on increasing clean energy use, decreasing the carbon intensity of output, and reducing carbon emissions. A subsidy on exports to the USA reduces the adverse impact of a carbon tariff on China’s social welfare in the short term.

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Addressing the competitiveness effects of taxing carbon in China: domestic tax cuts versus border tax adjustments

Cited by 57 publications

References 35 publications

The Impacts of Environmental Tax in China: A Dynamic Recursive Multi-Sector CGE Model

The Impacts of Environmental Tax in China: A Dynamic Recursive Multi-Sector CGE Model

Fossil fuel carbon taxation policy effect on thai household expenditure using input–output price structural path model

Impacts of U.S. Carbon Tariffs on China’s Foreign Trade and Social Welfare

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