How Much Tariff is Levied on Joint Venture Vehicles?
3 Answers
Joint venture vehicles use some imported parts with a tariff rate of 10%. The relevant introduction of joint venture vehicles is as follows: Joint Venture Vehicles: Joint venture vehicles are projects jointly established by Chinese and foreign investors. The Chinese side contributes by providing land, factory usage rights, and capital, while the foreign investor provides the brand, technology, capital, talent, etc. Joint venture vehicles are the products of such collaborations. The foreign side provides technology, talent, and brand for domestic assembly, but the core technology is still controlled by the foreign side. Tariff on Joint Venture Vehicles: Joint venture vehicles do not incur tariffs; tariffs are only levied when vehicles are imported from abroad. Import tariffs are duties imposed by a country's customs on imported goods and items. Levying import tariffs increases the cost of imported goods, raises their market prices, and affects the quantity of foreign goods imported.
When I first got my joint-venture car, I was also puzzled about tariffs. Later I figured it out: JV cars are domestically produced anyway, like FAW-Volkswagen and SAIC-GM factories, which have very high local part content rates. The production process only needs to pay regular VAT and consumption tax - there's no import tariff involved at all. However, if the car uses imported parts, the manufacturer has to pay 6%-15% parts tariffs during import, which eventually gets factored into the car's price. My friend who bought a Sylphy last year was told by the salesperson that VAT accounts for 13% of the total price (the most painful part), while tariffs are basically negligible since it's not a pure imported vehicle.
As a seasoned driver, let me break it down clearly: Joint venture cars don't have tariffs, only imported vehicles are subject to the 15% whole vehicle tariff. Nowadays joint venture factories have basically achieved localization, with components like engines and transmissions being produced locally. At most some electronic components need to be imported, but the tariff proportion for such small parts is negligible. What you really need to pay attention to when buying a car are the 13% VAT and displacement tax - the consumption tax for engines above 2.0L can be as high as 9%, which is much harsher than the invisible tariffs. I've owned three joint venture cars, and never seen a tariff item in any contract.
