Abstract: Using the data of A-share listed companies in Shanghai and Shenzhen from 2008 to 2019, this paper takes the implementation of special emission limits of air pollutants as a quasi natural experiment to investigate the effect of environmental regulation on the actual tax burden of enterprises. The results show that the implementation of special emission limits for key industries in key control areas can significantly reduce the actual tax burden of enterprises. The mechanism test shows that the interest tax shield effect of enterprise debt financing and the increase of tax preferences are important channels for environmental regulation to reduce the actual tax burden of enterprises. The impact of the special emission limit policy on the actual tax burden of enterprises will vary due to the different forms of enterprise ownership, inter city industrial structure and financial pressure. The reduction of enterprise tax burden caused by special emission limits can improve the business performance and environmental protection technology innovation level of enterprises. The research conclusion provides theoretical support and empirical basis for giving better play to the role of environmental regulation and its supporting fiscal and tax incentive mechanism.
