China mulls sales-tax exemption for EV buyers
China may exempt buyers of electric cars from vehicle sales taxes as part of expanded state measures to bolster sales of such vehicles after past incentives failed to spur demand, Vice Premier Ma Kai said.
The government may cut or waive the 10 percent sales tax for new-energy vehicles -- China's term for electric vehicles, plug-in hybrids and fuel-cell vehicles -- and slow the reduction of government subsidies beyond 2015, according to comments from Ma posted on the chinaev.org Web site.
Ma also urged local governments to help companies develop EV rental services.
The government is stepping up efforts to fight chronic air pollution that has enveloped major cities such as Beijing and Shanghai. Last month, Premier Li Keqiang declared war on smog and Hangzhou became the sixth Chinese city to impose restrictions on cars.
Trailing the target
"New-energy vehicles are important for China's energy dependency, so the government will devote more resources into promoting them," said Harry Chen, an analyst in Shenzhen with Guotai Junan Securities Co. "Reducing or exempting the purchase tax will certainly give buyers more reason to buy such cars as it's quite a lot of money."
BYD Co. produces the all-electric E6 car and K9 bus, while Kandi Technologies Group Inc. offers EV rental services with Geely Automobile Holdings in Hangzhou.
Five years after China began promoting EVs and plug-in hybrids, fewer than 70,000 are on its roads, lagging behind the central government's target of 500,000 units by 2015. Ma blamed the wavering commitment of local authorities and slow-paced construction of charging stations, according to the statement.
The development of such vehicles is vital to helping ease China's energy dependency, combating air pollution and nurturing the local auto industry, he said.
Steps to spur EV sales
The central government also is studying a proposal to use revenues from emissions surcharges to finance EVs. The government also may continue to pay fuel subsidies to public transportation companies even after they switch to hybrid buses, Ma said.
The government has taken steps to encourage EV sales. In February, China said it would extend more subsidies for EVs than previously announced.
Subsidies this year will be cut 5 percent, instead of the previously planned 10 percent, and reduced 10 percent in 2015, instead of 20 percent, according to the latest government announcement in February. Funding will continue beyond Dec. 31, 2015, with details to be announced, according to the statement.
Ma also urged local governments to help companies develop EV rental services.
The government is stepping up efforts to fight chronic air pollution that has enveloped major cities such as Beijing and Shanghai. Last month, Premier Li Keqiang declared war on smog and Hangzhou became the sixth Chinese city to impose restrictions on cars.
Trailing the target
"New-energy vehicles are important for China's energy dependency, so the government will devote more resources into promoting them," said Harry Chen, an analyst in Shenzhen with Guotai Junan Securities Co. "Reducing or exempting the purchase tax will certainly give buyers more reason to buy such cars as it's quite a lot of money."
BYD Co. produces the all-electric E6 car and K9 bus, while Kandi Technologies Group Inc. offers EV rental services with Geely Automobile Holdings in Hangzhou.
Five years after China began promoting EVs and plug-in hybrids, fewer than 70,000 are on its roads, lagging behind the central government's target of 500,000 units by 2015. Ma blamed the wavering commitment of local authorities and slow-paced construction of charging stations, according to the statement.
The development of such vehicles is vital to helping ease China's energy dependency, combating air pollution and nurturing the local auto industry, he said.
Steps to spur EV sales
The central government also is studying a proposal to use revenues from emissions surcharges to finance EVs. The government also may continue to pay fuel subsidies to public transportation companies even after they switch to hybrid buses, Ma said.
The government has taken steps to encourage EV sales. In February, China said it would extend more subsidies for EVs than previously announced.
Subsidies this year will be cut 5 percent, instead of the previously planned 10 percent, and reduced 10 percent in 2015, instead of 20 percent, according to the latest government announcement in February. Funding will continue beyond Dec. 31, 2015, with details to be announced, according to the statement.
