Research on the Effect of Export Tax Rebate Rate Adjustment on Industrial Emission in China

[Research on the Effect of Export Tax Rebate Rate Adjustment on Industrial Emission IN China]

[ShenglingBai, Beihang University, +86 13661028049,

[Chaofan Yang, Beihang University, +86 13810192675,

Overview

With continuous growth of economy and expansion of international trade, China’s ecological environment has been destroyed seriously, which restricts its sustainable development. Fighting against environmental pollution is one of the most important tasks.

As a major tax policy in China, the objective of export tax rebate has gradually changed from balancing tax and stimulating exports to balancing trade and optimizing industrial structure. To promote trade pattern transformation and reduce pollution, export tax rebates has been repeatedly reduced or even canceled for many environmental-harmful, high energy-consuming and resource-intensive products and increased for many high-tech, high value-added products since 2004.

In this paper, we study the effect of export tax rebate rate adjustment on industrial emission in China, with the logical linestarting from theoretical model derivation to empirical analysis.

Methods

Firstly, based on the ComputableGeneral Equilibrium model (CGE), this paper analyzes the theoretical influence of export tax rebate rate adjustment on industrial emission.

Secondly, based on the SVAR model, this paper from the perspective of the whole countryusing the data of China during 2003-2014analyzes the empirical influence of export tax rebate rate adjustment on industrial emission (including industrial sulfur dioxide, industrial smoke and dust).

Results

Both theoretical derivation and empirical results show that export tax rebate rate is significantly and positively related to industrial emission. As the export tax rebate rate is reduced by 1%, the growth rate of industrial emission, industrial sulfur dioxide, industrial smoke and dust will decline by 5.06%, 4.31%, 4.04% respectively.

Conclusions

The effect of export tax rebate rate adjustment in reducing industrial emission in China is significant, and it is beneficial to environment improvement and sustainable development.

References

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