The Impact of Water Resources Tax Policy on Water Saving Behavior

Abstract

The Chinese water administration department has continuously explored and formulated regulatory and market-oriented water control policies to alleviate the contradiction between water shortage and economic and social development and promote the new idea of ‘water-saving first’ water control. Among them, implementing a water resources tax policy as a price means has achieved initial success. The water-saving effect of water resources tax collection is one of the important bases for determining whether the tax reform will be promoted nationwide in the next stage. Based on this, taking Hubei Province, the first tax reform pilot in China, as an example, water resource elements are integrated into the economic system and a dynamic stochastic general equilibrium model (DSGE) is constructed, embedded in water resources tax to simulate the persistent impact of such a tax on water saving objectives. The research shows that: (1) A water resources tax can effectively achieve the goal of water-saving and improve the utilization efficiency of water resources. (2) Levying a water resources tax helps to improve the water-saving awareness of enterprises and residents and promotes enterprises to optimize their production structure. (3) Rational and efficient use of special water resources protection funds is the basis for ensuring the effective implementation of a water resources tax. It can also improve the recycling capacity of water resources. This means that the government should speed up the exploration of the relationship between supply and demand for comprehensive water resources, to establish a reasonable range of water resources tax rates to guarantee people’s livelihoods, and to accelerate the construction of water resources tax guarantee measures, in order to achieve a relatively steady-state of water resources utilization and protection, realizing the dual goal of sustainable economic development and sustainable use of water resources.

Ecolabels and the economic recession

“…We also note that if we had detailed data over the entire time span of our analysis, both on the standard variant of a product and the eco-labeled variant of the same product, we could have teased out individual product effects using a difference-in-differences method (see for example, [ 55 , 56 ] for examples of this approach). However, we do not have this data for all products in our data set.…”

A Comprehensive Analysis of China’s Water Resources Tax Reform

“…Since the prices of products in each sector change, the costs also change, resulting in changes in unit output income for each sector [31]. The change in income per unit output should be equal to the change in income minus the change in cost.…”

Can the Water Resource Fee-to-Tax Reform Promote the “Three-Wheel Drive” of Corporate Green Energy-Saving Innovations? Quasi-Natural Experimental Evidence from China

“…As a market-based regulatory tool, this policy will produce external shocks, leading to a "survival of the fittest" effect in the short term [29]. Therefore, to avoid penalties from local governments and to reduce operating costs for survival in the current environment, manufacturing enterprises will adopt advanced environmental protection equipment, thereby quickly reducing wastewater discharge and achieving the efficient use of water resources [30].…”

“…Furthermore, through adjustments or reorganizations in management models and organizational forms, green energy-saving management innovations can effectively reduce the R&D costs for companies, mitigate the risks associated with autonomous upgrading, and deeply instill a culture of sustainable development. Then, it impacts critical internal aspects such as planning optimization, production organization, the input of elements, process management, and talent deployment, accelerating the pace of mission-driven and visiondriven green energy-saving technological innovations in manufacturing enterprises [30]. Based on the analysis above, the following hypothesis was proposed: Hypothesis 3 (H3).…”