Based on the difference between tax and fee, using the methods of DID, PSM, instrumental variables and triple-differences, this paper examines the impact of the fee-to-tax policy on the environmental protection investment of seriously polluting enterprises and its mechanism, and finds that the implementation of the fee-to-tax policy has effectively increased the environmental protection investment of seriously polluting enterprises. Further distinguishing between preventive and curative environmental protection investment, the study finds that the role of fee-to-tax in promoting the investment of seriously polluting enterprises in environmental protection is mainly reflected in the preventive investment in environmental protection, which indicates that the tax reform in the environmental protection field has a catalytic effect on the upgrading of the environmental protection investment structure of enterprises. Mechanism analysis finds that the effect of the fee-to-tax policy on environmental protection is mainly achieved through the channels of raising pollution discharge costs, increasing the rigidity of law enforcement, and breaking the collusion between local governments and enterprises. Considering the heterogeneity of property rights and enterprise size, it is found that the promotion effect of the fee-to-tax policy on environmental protection investment is more significant in small-scale and non-state enterprises. In addition, the study also finds that government green subsidies weaken the promotion effect of the fee-to-tax policy on environmental protection investment.
The main contributions of this paper are as follows: Firstly, it examines the policy effect from the perspective of environmental protection investment, which is more in line with the purpose of environmental tax reform, and is an important supplement to the literature on the effect of environmental fee-to-tax policy. Secondly, it explores the impact of the fee-to-tax policy on the structure of environmental protection investment, which reveals the role of fee-to-tax in promoting the upgrading of the environmental protection investment structure of enterprises, and provides a broader perspective for the evaluation of the effect of the fee-to-tax policy on environmental protection. Thirdly, it enriches the study of the mechanism between environmental regulation and enterprise environmental protection investment behavior, helps to better understand the environmental protection investment activities of enterprises, clarifies the channels of the effectiveness of government environmental control, and provides policy reference and useful experience for carbon tax.