Beijing tax targets organic emissions

Beijing will levy a new tax on the discharge of volatile organic compounds from five major industries to further control air pollution by increasing its cost.

The new tax will cover over 2,000 companies from the five largest emitters－petrochemicals, furniture manufacturing, package printing, automobile manufacturing and electronics manufacturing－Beijing Environmental Protection Bureau said on Tuesday.

The tax will take effect on Oct 1, said Wang Chunlin, head of pollution control at the bureau. The five major industries in the pilot project account for 80 percent of emissions.

Companies will pay 20 yuan ($3.15) per metric ton of volatile organic compounds discharged below their allowed limit. The tax on emissions is higher than the average cost of processing the pollutants, which encourages companies to reduce their volatile organic compound emissions.

Companies that fail to install necessary facilities to deal with excessive volatile organic compound emissions will pay 40 yuan per ton, while companies that cut emissions will only be taxed 10 yuan per ton.

"It sends a positive signal from the government to encourage reduction efforts from the companies, like upgrading their technologies and adopting environmentally friendly materials," Wang said.

Additionally, companies that violate emission restrictions will face extra punishment, including fines and suspensions, the bureau said.

The volatile organic compounds are major airborne pollutants in Beijing that can generate ozone and PM2.5－fine matter with a diameter smaller than 2.5 microns. They come mainly from the production and consumption of gas, petrol, coating materials and organic solvents, the bureau said.

Different from sulfur dioxide, volatile organic compounds have more complex compositions and are produced by many industries.

Bureau officials and environment researchers believed it is more effective to have companies reduce emissions during production.

On March 1, Beijing started to tax dust emissions from construction sites, another major source of air pollution.

The tough controls have worked. Beijing has seen an improvement in air quality in the first half of the year, reducing heavily polluted days to 16, nine days fewer than the same period of 2014.