China exempts purchase tax for new energy cars in next two years

China's Ministry of Finance said today that from January 1, 2021 to December 31, 2022, new energy vehicles purchased will be exempt from vehicle purchase tax.

The announcement pointed out that new energy vehicles exempt from vehicle purchase tax refer to pure electric vehicles, plug-in hybrid (including extended range) vehicles, and fuel cell vehicles.

New energy vehicles exempted from vehicle purchase tax shall be managed by the Ministry of Industry and Information Technology and the State Administration of Taxation on the release of the "Catalogue of New Energy Vehicle Models Exempted from Vehicle Purchase Tax" (hereinafter referred to as the "Catalog").

From the date of publication of the "Catalogue", the purchase of new energy vehicles listed in the "Catalogue" will be exempted from vehicle purchase tax; the purchase time shall be the date indicated on the unified invoice (or valid certificate) of motor vehicle sales.

For new energy vehicles that have been listed in the "Catalogue", new energy vehicle manufacturers or imported new energy vehicle dealers are uploading the "Vehicle Motor Vehicle Factory Certificate" or the imported vehicle "Vehicle Electronic Information Sheet", mark “Yes” (namely the tax exemption mark) in the field of “whether the vehicle purchase tax exemption conditions are met”.

The Ministry of Industry and Information Technology will review the tax-free logos in the electronic information of vehicles uploaded by automobile companies, and transmit the approved information to the State Administration of Taxation.

The tax authority shall handle the vehicle purchase tax exemption procedures based on the tax exemption mark and the unified sales invoice (or valid certificate) of the motor vehicle after review by the Ministry of Industry and Information Technology.

In addition, the announcement stated that automobile companies should ensure that vehicle electronic information is consistent with vehicle products, and any loss of vehicle purchase tax due to the provision of false information or materials shall be handled in accordance with the "Tax Collection and Administration Law of the People's Republic of China" and its implementation rules  .