The NEV purchase tax exemption in July was CNY 7.17 billion, an increase of 119.1% year-on-year.
The latest statistics released by the State Taxation Administration of China (STA) show that exempted tax fees for new energy vehicle (NEV) purchases were worth CNY 40.68 billion (USD 5.89 billion) from January to July this year, a year-on-year increase of 108.5%. In particular, the purchase tax exempted in July was CNY 7.17 billion, up 119.1% year-on-year.
To support the development of fuel-efficient vehicles, China first began exempting NEVs purchase taxes in 2014. The policy originally expired at the end of 2017, but was first extended to the end of 2020.
China will continuously extend its exemption of NEV purchase taxes to the end of 2023, with an estimated amount of CNY 100 billion tax exemption, sourcing the latest decision made by the State Council at an executive meeting held on August 18, 2022.
Statistics from the China Association of Automobile Manufacturers (CAAM) suggest that automobile production and sales reached up to 2.455 million and 2.42 million respectively, up 120% year on year.
According to officials of the State Taxation Administration (STA), STA will liaise with the Ministry of Finance to issue announcements and continuously update the Exemption of Vehicle Purchase Tax on New Energy Vehicles. To realize automatic identification in the information filing process, a tax exemption mark can be added to the electronic information of the vehicle's certificate. This will simplify the procedures and save time for NEV buyers when they apply for tax exemption.