Do second-hand cars require payment of purchase tax?
2 Answers
If the original owner has paid the purchase tax, then the purchased second-hand car does not need to pay it again. If the purchase tax was not paid when the car was new, then after the second-hand car is traded, the new owner needs to pay the remaining purchase tax. Relevant information is as follows: 1. The purchase tax for a car only needs to be paid once, usually when the car is new, but the original owner must provide a complete proof of purchase tax payment. With the tax payment proof, the purchase tax does not need to be paid when buying a second-hand car. 2. Currently, there are some tax-exempt cars appearing in the second-hand car market. The latest 2021 "Provisional Regulations on Vehicle Purchase Tax" of the country states: a tax-exempt car that has been used for more than ten years does not need to pay back taxes, but if the tax-exempt car to be purchased has been used for less than ten years, consider whether the cost of paying back the purchase tax is acceptable.
Last time I bought a used car, I did some research and learned that in China, the purchase tax is only paid once when buying a new car, usually at a rate of 10% of the car's price. So when you take over a used car, this tax has already been paid by the previous owner, and you don't need to pay it again. The transfer process is very simple—just go to the DMV to complete the registration transfer and pay some fees, such as a few hundred yuan for the transfer fee and insurance adjustment. That time, I bought an older SUV and saved nearly 10,000 yuan in taxes, which was a great deal. I also recommend getting a third-party inspection of the vehicle's condition before the transaction to avoid hidden issues. Additionally, don’t forget to handle the transfer of the vehicle insurance—the cost isn’t high, but the paperwork must be complete.
