The optimal tax rate of COD and ammonia nitrogen was estimated based on the estimated economic loss caused by domestic sewage and the determined tax base in Binzhou City.The results show that due to the pollution of COD and ammonia nitrogen,the average economic loss of domestic sewage in Binzhou City from 2010 to 2017 was 167.292 million and 178.040 million yuan respectively.The average pollution equivalent amount of COD and ammonia nitrogen in domestic sewage in Binzhou City was 43435 and 3900 t respectively,and the average optimal tax rate of COD and ammonia nitrogen was 3.85 and 45.65 yuan/kg respectively.That is,residents should pay a pollution tax of 3.85 yuan for every 1 kg of COD discharged and a pollution tax of 45.65 yuan for every 1 kg of ammonia nitrogen discharged.