Research On China's Optimal Environmental Tax Rate

Since the reform and opening up,China's economic development level has been at the forefront of the world,but the problem of environmental pollution is also very serious.At present,the government has fully realized that the development of sacrificial environment is unsustainable.The"19th CPC National Congress" report has repeatedly proposed to "promote green development","make a good battle against pollution prevention and control"and"build beautiful China." China's environmental protection legislation is also improving day by day,and the environmental tax was officially levied on January 1,2018.At present,the implementation of environmental tax in China is still in its infancy.Therefore,the design of the optimal environmental tax rate and the environmental tax effect have become a very important issue at this stage.After the reform of state-owned enterprises in China,the industry structure gradually tends to be characterized by"monopoly of upstream state-owned enterprises and competition of downstream private enterprises".Based on this market structure,the study of environmental tax effects is more in line with social reality.In addition,we can explore the impact of interaction mechanisms between upstream and downstream markets on environmental tax collection.This paper combines the environmental tax collection and the upstream and downstream relationship to study the various effects of environmental tax collection and the determination of the optimal environmental tax rate under the market structure of"Chinese vertical structure".In this paper,a model of environmental tax collection under the"Chinese vertical structure"is constructed in the basic model.We study the impact of environmental tax collection on total social output,intermediate product prices,upstream and downstream corporate profits,environmental damage and social welfare is discussed.We analyze the determination and influencing factors of the optimal environmental tax rate as well.We found that the increase in environmental taxes will lead to a decline in total social output,and the degree of pollution of upstream and downstream enterprises is the decisive factor for whether the government will impose environmental taxes.The larger the market,the higher the environmental tax.The more the number of downstream private enterprises,the higher the environmental tax.This paper expands the basic model for taking the emission reduction technology into consideration.This paper analyzes the environmental tax effect after using the emission reduction technology,and compares and analyzes the optimal environmental tax rate,social output,intermediate product price,environmental damage degree and social welfare before and after technological progress.The study found that after using advanced emission reduction technologies,the optimal environmental tax rate will decrease,the total social output will increase.The degree of environmental damage in the economy will decline,and social welfare will improve.However,the price of intermediate products will change due to the pollution level of upstream and downstream enterprises.Finally,based on the conclusions of the theoretical model and the Chinese reality,this paper proposes policy recommendations on environmental tax collection.