After research by the Ministry of Finance and other relevant departments, China hopes to begin levying a carbon tax during the 12th Five-Year Plan period (2011-2015), using carbon dioxide emissions as the tax base, with 2012 being the optimal time for its implementation. A research team from the National Development and Reform Commission and the Ministry of Finance recently completed a special report on "The Framework Design of China's Carbon Tax System." The *Economic Information Daily* points out that the report analyzes the necessity and feasibility of levying a carbon tax in China, proposes the basic objectives and principles for implementing a carbon tax in China, preliminarily designs the basic content of the carbon tax system, and specifically proposes the implementation framework and related supporting measures for China's carbon tax system. It is understood that the Ministry of Environmental Protection, the Ministry of Finance, and the State Administration of Taxation have already completed their plans for environmental taxes. A source close to the Ministry of Environmental Protection said that China's carbon tax is essentially a change from the current resource tax to a carbon tax, "currently only 2%, we will increase the tax rate." Currently, five Nordic countries—Denmark, Finland, the Netherlands, Norway, and Sweden—have implemented carbon tax or energy tax policies, and France will follow suit this year. Meanwhile, since carbon dioxide is produced by consuming fossil fuels, the carbon tax should be levied on businesses involved in coal, natural gas, and refined oil production—that is, entities and individuals that directly emit carbon dioxide into the environment. Regarding the allocation of the carbon tax, experts suggest that it should not be a local tax. However, given the current low level of local tax revenue in China, they recommend that the carbon tax be shared between the central and local governments, with a revenue split between the two.
