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China to implement new automobile consumption tax regulatio

China could implement the new automobile consumption tax regulation on May 1, 2006, according to a report in Fazhi Zaobao (Legal Morning Post) citing officials from the State Development and Reform Commission (SDRC). 
Based on the new regulation, high-displacement fuel guzzling SUVs and luxury sedans would be affected the most. Consumption tax rates levied on these types of vehicles could be as high as 20-25 percent. On the other hand, consumption taxes will be reduced for small-displacement and economy cars. The new regulation will replace the existing one which has been implemented for 11 years with only three levels of consumption tax of one, five and eight percents depending on vehicle displacement.

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