The Impact Of Environmental Protection Tax Law On The Performance Of Heavy Polluting Enterprises

Since the reform and opening up,China’s economy has been developing rapidly,but the ecological environment has been deteriorating,and coordinating environmental protection and economic growth has become a priority task in China.As enterprises are the main force of environmental protection and economic development,the government’s formulation of environmental regulation policies to stimulate enterprises to seek a green development path is an important step to alleviate the contradiction between economy and environment.Therefore,China enacted the environmental protection tax law in 2016,which triggered a wave of research on its micro-economic effects in academia.As the main target of environmental protection tax policy implementation,it is important to explore the impact of environmental protection tax law on the performance of heavy polluting enterprises.In this paper,the relationship between the environmental protection tax law and the performance of heavy polluting enterprises and the difference in the nature of their property rights is empirically investigated using a double difference model with the enactment of the environmental protection tax law in 2016 as an exogenous event,taking listed companies from 2012 to 2020 as the research sample.In addition,this paper further tests the effect of corporate social responsibility on the relationship between the environmental protection tax law and the performance of heavy polluting enterprises by constructing a moderating effect model.The results show that(1)the environmental protection tax law has a positive effect on the performance of heavy polluting enterprises,and after the enactment of the environmental protection tax law,the improvement of the performance of heavy polluting enterprises is significantly greater than that of non-heavy polluting enterprises.(2)The relationship between environmental protection tax law and heavy polluting enterprise performance is positively moderated by corporate social responsibility,and the higher the level of corporate social responsibility,the greater the effect of environmental protection tax law on the performance of heavy polluting enterprises,and this effect exists only in enterprises with higher level of social responsibility.(3)Further analysis reveals that there is heterogeneity in the effect of environmental protection tax law on the performance of heavy polluters.Firstly,the positive effect of environmental protection tax law on the performance of state-owned enterprises is more significant;secondly,the positive relationship between environmental protection tax law and enterprise performance exists only among larger enterprises;finally,environmental protection tax law improves the performance of heavy polluting enterprises in the eastern and western regions,but does not have a significant effect on enterprises in the central region.Based on the above findings,this paper proposes policy recommendations at the government and enterprise levels,respectively.Firstly,the government should effectively implement the environmental protection tax policy;improve the corporate social responsibility information disclosure system;and develop environmental protection subsidy and incentive policies.Secondly,enterprises should take positive measures to respond to the environmental protection tax policy such as developing green products and optimizing process flow;actively undertake corporate social responsibility,establish a good image and achieve sustainable development.By exploring the relationship between environmental protection tax law and the performance of heavy polluting enterprises,and the differences in the relationship between the two in different contexts of corporate social responsibility commitment,this paper has the following contributions:(1)It enriches and improves the study of the micro-economic effects of environmental protection tax policies,and provides a new perspective for theoretical studies related to environmental regulation.(2)It provides empirical evidence for the government to improve and implement environmental protection tax policies,and provides practical guidance for enterprises to respond to environmental regulation policies.