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Abstract

Within the framework of existing Chinese environmental laws, carbon taxation faces four main challenges: the contradiction of existing taxes, conflict with the carbon emissions trading system, necessary adjustments to the organizational structure of tax collection and management, and coordination with international trade rules. Implementing a carbon tax is a complete and systematic process containing three stages: introduction, collection, and impacts assessment. In order to address these problems, it is necessary to construct legal implementation mechanisms for carbon taxation in China. The legal mechanisms of implementing a carbon tax include a series of coordination and safeguard measures aimed at optimizing the comprehensive environmental, economic, and social benefits of a carbon tax. This will become operative by integrating the carbon tax with existing environmental taxes and fees and by coordinating the different functions of a carbon tax and the carbon emissions trading system. In the context of modern economic globalization, the practice of a domestic carbon tax policy must be consistent with international trade rules. Therefore, making reasonable regulations for carbon tariffs is also an important component of the legal implementation mechanisms.

Part II of this article discusses the possible overlap between existing environmental taxes and the carbon taxes that will be levied and identifies the conflict between the two systems. Part III establishes a balanced mechanism to promote the complementarities between carbon taxation and carbon emission trading. Part IV introduces the European practice of carbon tax management, and proposes to construct a technical and administrative organization to safeguard the positive social effects of carbon taxation. Part V critically discusses carbon tariffs to ensure their conformance with international trade rules.