The paper studies the profitability of the project of landfill gas recovery and power generation, and impacts of the government inspiring policies on the profitability of the project. The profitability of the project is influenced by preferential tax, life span of the project and supply price to grid, also by initial investment, run cost and income from sales. The government may influence the profitability of the project by two kinds of policies, which are preferential tax and preferential supply price to grid. On the other hand, making reasonable supply price to grid could give attention to the benefits of project and government on existing tax polices.