Since January 1st,2018,China has replaced the environmental protection fee with an environmental protection tax to protect and improve the environment,reduce pollution,and promote ecological civilization.The tax covers air,water,solid,and noise pollutants.The tax rates are set by the local governments within the legal range based on the environmental capacity,the pollution level,and the regional ecological development goals.Using the Environmental Protection Tax Law,which replaced the environmental protection fee in China,as a natural experiment to study the impact of the tax reform on the ESG performance of heavy polluters using DID analysis with data from China's A-share listed companies from 2013 to 2022.The main findings are:(1)Using the Sino-Securities ESG index as the explanatory variable,it shows that the ESG scores of heavy polluters increase more than those of non-heavy polluters after the tax reform,which indicates that the tax reform effectively regulates and motivates the environmental and social behavior of heavy polluters,improves their environmental performance,corporate governance,social reputation,and competitiveness.The robustness of the results are tested by changing the explanatory variables(using the Bloomberg ESG index instead of the Sino-Securities ESG index),re-classifying the heavy polluters,and examining the anticipation effect of the tax reform.(2)The tax reform has a stronger impact on the ESG performance of non-high-tech,eastern,low-tax,and heavily polluted enterprises,showing that the tax reform has a differentiated effect on various enterprises and regions.The tax reform affects less those enterprises that are more environmentally and socially conscious,and more those that need more environmental and social improvement.(3)By exploring the mechanism of environmental fee tax reform on ESG performance,it is found that after the environmental fee tax reform,heavy polluting enterprises will carry out transformation and upgrading and make more green investment,while enterprise transformation and upgrading and green investment can promote the improvement of ESG performance.Insights and policy suggestions are put forward for China's green tax reform.The reform is an effective environmental policy that improves ESG performance of enterprises and benefits both the economy and the environment.First,the environmental protection fee to tax is an effective environmental policy,which can promote the improvement of ESG performance of enterprises by regulating their behavior,thus realizing a win-win situation for both the economy and the environment.Second,the environmental fee reform tax has different impacts on different types of enterprises and different regions,so when formulating and implementing the environmental tax policy,we should fully consider the differences between enterprises and regions,and formulate reasonable tax rates and preferential policies in order to achieve a balance between fairness and efficiency.Finally,the mechanism of environmental protection fee to tax is mainly to improve ESG performance by promoting the transformation and upgrading of enterprises and green investment,so while promoting environmental protection fee to tax,technical support and financial support for enterprises should be strengthened in order to reduce the transformation cost and risk of enterprises and improve their innovation ability and competitiveness.
environmental protection taxESGenterprise transformation and upgradinggreen investmentheavily polluting industries
万方数据
维普
