Environmental “Fee-to-Tax” and Heavy Pollution Enterprises to De-Capacity

Will environmental “fee-to-tax”, which strengthens the rigidity of levies and increases costs heavy pollution enterprises, force enterprises to de-capacity. This paper examines impact heterogeneity “fee-to-tax” on enterprises’ de-capacity by taking official implementation Environmental Protection Tax Law People’s Republic China in 2018 as institutional listed industrial Shanghai Shenzhen A-shares from 2015 2019 sample. The study found that pushed After parallel trend tests, placebo eliminate policy interference, propensity score matching, replacement variables, findings this are robust. Further analysis shows effect is more significant state-owned high financing constraints areas with higher tax collection management; still effective low economic development because all revenues included local finance. follows up tests regulations provides a valuable reference for government promote task green transformation upgrading structure through actively playing role protection.