By staff reporter Chang Hongxiao

Polluters might pay more in China. A new system of ‘polluter payment’ is looming with higher charges for wastewater treatment, garbage disposal and pollution discharge.

Bi Jingquan, deputy director of the National Development and Reform Commission called for such a regulation at the opening ceremony of China Public Finance Research Center of Peking University on June 26^th. He told Caijing that a proposal was handed to the State Council and would be launched soon.

The Chinese government taxes industrial enterprises for pollution discharge and penalizes those who over-pollute. It charges residents for wastewater and garbage disposal. But what has been collected is far from enough.

Bi said garbage burning currently costs 50 billion yuan a year, but the government gathers only about 2 billion from taxes. 30 billion yuan is needed to tackle sulfur dioxide emission while only one third of the money in place. Furthermore, wastewater treatment fee is also 68.2 billion short of its due amount.  

Bi suggested several ways to improve the current pollution management system. 

First, pollution charges should increase gradually to cover the cost of treatment.  

Second, the scope of areas targeted for pollution taxes should expand from solely focusing on big metropolitans to including medium and small sized cities. Furthermore, implementation should be reinforced. Bi cited two big cities in the northern region: one collected only one tenth of its garbage disposal fee, and the other stopped collecting altogether.   

Third, market mechanism is necessary to manage pollution treatment companies; they should be separated from the government. Presently, these companies report to various government-sponsored environmental agencies. 

Finally, the government should provide direct subsidies to low income households. A higher pollution charge will likely raise their living expenses.