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Following is a question by the Hon Sin Chung-kai and an oral reply by the Secretary for the Environment, Transport and Works, Dr Sarah Liao, in the Legislative Council meeting today (June 7) :
Question:
Will the Government inform this Council:
(a) apart from the planned tax on plastic bags and levy on tyres, whether the authorities plan to review the modes, percentages and scopes of the existing taxes and government fees and charges (such as first registration tax on motor vehicles and sewage charges, etc), and to consider other new "green" taxes, so as to change, by way of economic incentives, the public's habit of using environmentally unfriendly products, thereby improving the quality of Hong Kong's environment; and
(b) whether it will consider setting up an independent agency to take the place of the Treasury in receiving "green" tax revenue and be responsible for examining the details of implementing the levying of "green" taxes, as well as utilising such revenue on environmental protection, so as to ensure that the purpose of levying "green" taxes is not to increase Government revenue but to change the public's habits by way of economic incentives?
Reply:
Madam President,
(a) In December last year, the Government published "A Policy Framework for the Management of Municipal Solid Waste (MSW) (2005-2014)", which set out a forward-looking and comprehensive strategy to tackle the serious and imminent waste problem in Hong Kong. The message of the "Policy Framework" is clear and simple - we must be held responsible for the waste we produce. By implementing the "polluter-pays" principle endorsed by Members and the public, we hope to induce behavioural changes among the public and encourage waste reduction and recycling through direct economic incentives. This will not only help protect our natural environment, but also let us better utilise Earth's valuable resources.
In line with the "polluter-pays" principle, we propose to introduce the producer responsibility schemes (PRSs) whereby manufacturers or importers are required to take back their products for proper waste management while consumers have to assist in the recovery and recycling process, and share with the manufacturers or importers the cost of proper disposal of end-of-life products. We have set out in the "Policy Framework" the timetable for implementing PRSs for six types of products (vehicle tyres, plastic shopping bags, electrical and electronic equipment, packaging materials, beverage containers and rechargeable batteries), with priority given to vehicle tyres and plastic shopping bags.
The Legislative Council Panel on Environmental Affairs was consulted on the proposed legislation for implementation of PRSs in April this year. The discussion paper sets out the core elements of PRSs, which include, inter alia, the requirement for manufacturers or importers to take back their products, the implementation of a deposit-refund system, advance recycling fees and product taxes/levies. We will take into account overseas experience and consider the Hong Kong situation before deciding on how to implement individual PRSs.
While we have yet to introduce PRSs, some existing charges such as the sewage charge and construction waste disposal charge have already put in place the "polluter-pays" principle and offered economic incentives to reduce pollution. For example, since the construction waste disposal charging scheme commenced on 20 January this year, the amount of construction waste handled by construction waste disposal facilities (including landfills, sorting facilities and public fill reception facilities) has been reduced by about 20%.
Regarding the sewage charge and trade effluent surcharge, they aim at recovering the Government's costs of operating sewage treatment facilities. We are reviewing the charges with a view to securing a more equitable sharing of the operating costs among the public and the relevant trades, and with a view to recovering the full operating costs eventually so as to induce further reductions in the volume and pollution loads of discharged sewage.
For the first registration tax on motor vehicles mentioned by the Hon Sin, the Government, as stated in this year's Budget, will consider introducing measures to promote the use of hybrid vehicles when more options are available on the market. Also, electric vehicles have been exempted from first registration tax since the 94/95 fiscal year. This exemption will continue to be effective until March 31, 2009.
We also proposed MSW charging in the "Policy Framework" as a new "green" tax. At present, the annual cost of MSW management, nearly $1.2 billion, comes out of the public purse. There are no economic incentives for the public to reduce waste. Through MSW charging, we hope to encourage the public to change their consumption-led lifestyle and separate their waste for recovery and recycling, thereby alleviating the burden on our landfills.
The Government will review existing taxes and consider other fiscal measures from time to time to further promote environmental protection. We welcome Members' views in this respect.
(b) With regard to part (b) of the question, I would like to state again that the purpose of introducing PRSs is certainly not to increase Government revenue, but to implement the principle of "polluter-pays" so as to change the consumption-led lifestyle of the public. The money received under PRSs will mainly offset Government spending on waste recovery, recycling and other environmental protection initiatives. We have no plans to set up an independent agency to take the place of the Treasury in receiving "green" tax revenue.
Having said that, we understand that for certain PRSs, the industries concerned, rather than the Government, might be in a better position to operate recycling programmes for their own products, given their unique market knowledge. Therefore, in the discussion paper submitted to the Panel on Environmental Affairs in April, we proposed allowing the establishment of "industry organisations" under the "Product Eco-responsibility Bill". Such organisations would be tasked to manage recovery and recycling programmes for their own products. This approach has been adopted in places like Canada. We will study and consider the operating mode of such organisations when drawing up individual PRSs so as to make the schemes both cost-effective and environmental friendly.
Ends/Wednesday, June 7, 2006
Issued at HKT 14:30
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