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Existing international experience can provide sound reference for the
design and reform of the Chinese fiscal instruments for the time being.
Table 2.5 is a summary of the key fiscal instruments which may be
applied to the low carbon financing of local governments by the key
sectors related to low carbon economy. According to the sources of
local governments’ funds, such instruments include taxes and fees, as
well as transfer payments of the central government.
It is worth emphasizing that the existing international experience
may not necessarily be applicable to China due to the differences in
national conditions. Hence, adaptability of policies to suit the local
context is important. In view of the sources of the local governments’
fiscal revenue, as shown in Table 2.5, this section will first strive to
analyse the status quo of each fiscal instrument in China, and then
move on to the reform and innovation of each fiscal instrument and
the methods of fiscal revenue management in light of the international
experience, with a view of providing the local governments with better
financing services in their efforts to develop the low carbon economy.
Table 2.5 Summary of the Fiscal Instruments for the Low Carbon Financing of Local
Governments by the Sources of Fund and the Key Sectors
Instrument Transportation Building Waste Energy
Recycling
and Disposal
Taxes Consumption Tax, (Property Ownership (Property Tax) (Energy Tax)
(Carbon Tax)
Vehicle and Vessel Tax Tax)
(Construction Fee)
Fees (Congestion Fee) Land Transfer Fee Property Electricity
Parking Fee (Development Fee) Management Surcharge
(Highly Travelled Road (Excessive Plot Ratio Fee
Fee) Fee)
(Other Fees)
Transfer Current Account
Payment of Expenditure
the Central Subsidies
Government Special Funds
[Earmarking of Tax
Revenues]
Note Policies within parantheses are those which have been put in place in other countries but have
not yet been adopted or widely applied in China.
2.3.1 Taxation
Taxes are an important source of revenue for central and local
governments. According to the distribution methods of tax revenue,
86 Low Carbon Development in China and India
design and reform of the Chinese fiscal instruments for the time being.
Table 2.5 is a summary of the key fiscal instruments which may be
applied to the low carbon financing of local governments by the key
sectors related to low carbon economy. According to the sources of
local governments’ funds, such instruments include taxes and fees, as
well as transfer payments of the central government.
It is worth emphasizing that the existing international experience
may not necessarily be applicable to China due to the differences in
national conditions. Hence, adaptability of policies to suit the local
context is important. In view of the sources of the local governments’
fiscal revenue, as shown in Table 2.5, this section will first strive to
analyse the status quo of each fiscal instrument in China, and then
move on to the reform and innovation of each fiscal instrument and
the methods of fiscal revenue management in light of the international
experience, with a view of providing the local governments with better
financing services in their efforts to develop the low carbon economy.
Table 2.5 Summary of the Fiscal Instruments for the Low Carbon Financing of Local
Governments by the Sources of Fund and the Key Sectors
Instrument Transportation Building Waste Energy
Recycling
and Disposal
Taxes Consumption Tax, (Property Ownership (Property Tax) (Energy Tax)
(Carbon Tax)
Vehicle and Vessel Tax Tax)
(Construction Fee)
Fees (Congestion Fee) Land Transfer Fee Property Electricity
Parking Fee (Development Fee) Management Surcharge
(Highly Travelled Road (Excessive Plot Ratio Fee
Fee) Fee)
(Other Fees)
Transfer Current Account
Payment of Expenditure
the Central Subsidies
Government Special Funds
[Earmarking of Tax
Revenues]
Note Policies within parantheses are those which have been put in place in other countries but have
not yet been adopted or widely applied in China.
2.3.1 Taxation
Taxes are an important source of revenue for central and local
governments. According to the distribution methods of tax revenue,
86 Low Carbon Development in China and India
