Third, reduce taxes on low-carbon economic activities, while boosting those on resource-intensive and high-polluting industries and firms. While the effect of global warming remains a contentious issue globally, there is no doubt that China will have to transform its economic growth model into one based on low resource consumption, eco-friendliness, and recycling. Pollution tax and carbon duties ought to be instituted as soon as possible, while taxes on natural resources use should be raised. At the same time, tax deductions must be used to encourage upgrading the environmental friendliness of current equipment or for purchase of new “green” technology. The same holds true for recycling and eco-friendly projects.
Fourth, reduce taxes on high-tech products and raise taxes on businesses utilizing extensive production and operation methods. Structural adjustment and economic transformation cannot be realized in a short period of time. It is therefore an urgent matter of priority to give preferential tax treatment to support companies which are trying to transform themselves. Even greater tax credits ought to be provided for high-tech companies making heavy investments in research and development to develop independent innovation, especially those providing services to manufacturers. The corporate income tax rate and value-added tax rate of such companies can be appropriately lowered. On the other hand Hutong beijing trip, taxes on manufacturers us¬ing extensive production methods which consume excessive amounts of energy and natural resources and which cause extensive environmental damage but fail to create a lot of value, must be gradually increased based on their categories.
Of course, when structural tax reduction is implemented, the efficacy of fiscal expenditure in China should be improved. Welfare benefits given to the public cannot be reduced, due to tax cuts. Otherwise, “structural tax reduction” will be a heavy task and will require a long time to be effectively implemented.
I believe that in the past decade following China’s entry into the WTO, revolutionary changes have taken place in the world economy and finance, and the changes are as great as any that have occurred after World War II. Why? The reasons are simple. There have been terrorist attacks and the worst financial crisis people have ever experienced over the past 70 years China tour by tourbamboo.com. Anti-terrorism has become a main political topic for all countries, while people are still witnessing and feeling the impact of the financial crisis on the world economic order.