Provincial air pollution responsibility and environmental tax of China based on interregional linkage indicators

Abstract

Air pollution presents a serious public health risk globally, particularly in fast industrializing countries such as China. Effectiveness of local air pollution control measures is influenced by external forces such as atmospheric emission transport and interprovincial trade. However, there is lack of research on comparison of these two indicators and local indicators (e.g. per capita income and emissions) determines the responsibility allocation in pollution control. In this paper, cross-provincial air pollution is stimulated via atmospheric transport (atmospheric linkage indicator) based on Weather Research and Forecasting/Comprehensive Air Quality Model with Extensions (WRF/CAMx) model. The air pollutants embodied in interprovincial trade (trade linkage indicator) was studied by using the latest multi-regional input-output (MRIO) model. This study revealed the significant influence of atmospheric transport on neighboring provinces. However, transport of trade-induced embodied emissions affects both neighboring areas and larger areas. According to aggregation analysis of these two indicators, in most provinces of China, direction of atmospheric transport contradicts to that of the trade-induced transport. These findings are used to analyze the rationality of regional differences in environmental tax rate in the new environmental protection tax law of China. By comparing the local and interregional linkage indicators, we found the current environment tax for air pollutants was mainly affected by per capita income whereas other environment and linkage indicators show little correlation. Therefore, we integrated environment and linkage indicators to propose adjusted provincial environment tax rates plan for air pollutants as a cost sharing mechanism. The results of this paper provide novel perspective for central government to adjust fairness environmental responsibility between provinces of China by tax policy.