Discussion Of The Establishment Of Ecological Tax System

China's economy has been developing quickly, but at the same time its environment has also been destroyed. Should we follow the same pattern of the developed countries, that is to solve the problem after the environment has been destroyed, or try to find a way of combining economical development and environment protection together? Under the circumstances, the state government has made a discreet choice to develop under the guidance of sustainable development theory for the benefit of people. Sustainable development theory is a new idea, which involves in every aspect of human society and economical development. The dissertation focuses on the taxation policy issue in the process of sustainable development in China: eco-tax's theoretical basis and its possible operation. The main objective is to discuss the possible functions of taxation in the protection of natural resources and environment in the context of sustainable development theory. The thesis consists of eight chapters. On the acquaintance of ecosystem, the first chapter tells the mutual effect between human and ecosystem. The second chapter tells the ecosystem's actuality in China. On the research of market failure and government failure, the third chapter analyzes the reasons why the ecosystem is deteriorating in China. The fourth and the fifth chapter summarize the theoretical basis on which the eco-tax theory is set up and discuss the possibility and necessity of eco-tax system in the context of China. The sixth and the seventh chapter give a general introduction of eco-tax system in other countries, and point out the drawbacks of that in China. The last chapter discusses the possible policies in the introduction of eco-tax system in China.