Environmental Protection Tax and Firms’ Green Technological Innovation: The Mediating Effect of Financing Constraints

China’s Environmental Protection Tax (EPT) provides an important institutional setting for examining whether market-based environmental regulation can promote firms’ green technological innovation (GTI). Using panel data from Chinese A-share listed firms from 2014 to 2023, this study employs a difference-in-differences framework to evaluate the impact of the EPT on firms’ GTI and further examines the mediating role of financing constraints. The empirical results show that: (1) the implementation of the EPT significantly promotes firms’ GTI; (2) the EPT promotes firms’ GTI partly by alleviating financing constraints; and (3) The heterogeneity results suggest that state-owned enterprises and larger firms derive greater GTI benefits from EPT. These findings suggest that improving the institutional design of the EPT, strengthening the coordination between environmental taxation and green finance, and providing targeted support for resource-constrained firms can enhance the effectiveness of environmental regulation in promoting corporate green transformation. These findings provide new evidence on the relationship between environmental taxation, financing constraints, and corporate GTI.