How Much Tax Do You Need to Pay When Buying a Car?
4 Answers
When buying a car, the taxes you need to pay include: 1. Vehicle Purchase Tax: The general tax rate is 10%. According to the "Provisional Regulations of the People's Republic of China on Vehicle Purchase Tax," the taxpayers of the vehicle purchase tax are units and individuals who purchase (including buying, importing, self-producing, receiving as gifts, winning as prizes, or obtaining through other means for personal use) taxable vehicles. The taxable scope includes cars, motorcycles, electric vehicles, trailers, and agricultural transport vehicles. 2. Vehicle and Vessel Usage Tax: This is generally paid when purchasing compulsory traffic insurance for the vehicle. The vehicle and vessel tax is a local tax. Based on the "Provisional Regulations of the People's Republic of China on Vehicle and Vessel Tax" and other regulations, the collection standard of the vehicle and vessel tax should also be determined according to the specific management measures formulated by local tax authorities. The vehicle and vessel tax can be paid together with the compulsory traffic insurance. The vehicle and vessel tax is paid annually, and the amount varies by region. 3. Value-Added Tax and Import Tariff: Imported cars are also subject to a 17% value-added tax and a 25% import tariff. The purchase tax for imported cars = taxable price × 10%, where the taxable price = customs duty-paid price + import tariff + consumption tax.
When I bought my new car, I specifically researched the tax issues. The biggest expense was the purchase tax, which is 10% of the car's price. For example, a 200,000 yuan car would incur 20,000 yuan in tax. The vehicle and vessel tax is also paid annually, and it depends on the engine displacement. My 1.5L car costs just over 300 yuan per year. The license plate fee varies by region, and in my area, it's around 300-500 yuan. New energy vehicles can save on purchase tax, but the gasoline car I was interested in didn't qualify for this discount. I recommend asking the 4S shop to provide a detailed list before picking up the car. Last time, I was charged a 2,000 yuan service fee, which I later found out was an unjustified charge. Vehicle insurance is another cost to consider, with compulsory traffic insurance starting at 950 yuan. All these additional costs can account for 10%-15% of the car's price.
Just got the car a week ago, the purchase tax is indeed quite painful. I bought an 180,000 yuan sedan and paid a 10% purchase tax, which amounts to 18,000 yuan. But I heard that luxury cars over 300,000 yuan have the same tax rate. The vehicle and vessel tax is based on the engine displacement. I chose a 2.0T and have to pay over 700 yuan a year. The tax exemption policy for new energy vehicles is really cost-effective; a friend who bought an electric car saved nearly 20,000 yuan. Remember to bring your bank card to pay the tax on the spot when picking up the car, and now you can also scan the QR code to pay with your phone. There are also significant regional differences; the license plate fee in Beijing is 400 yuan more expensive than in my hometown. The transfer fee for used cars is only a few hundred yuan, which is suitable for friends on a tight budget.
When buying a family car, you need to calculate the tax bill carefully. The purchase tax is charged at 10% of the invoice price, but 4S dealers often underreport the price. The vehicle and vessel tax is charged in tiers based on engine displacement—my wife’s 1.6L car costs 480 yuan annually. New energy vehicles enjoy tax exemptions until 2027, making them a good choice for neighborhoods with ample charging stations. Imported cars come with an extra 17% VAT, making domestic models more cost-effective. Don’t forget to negotiate the license plate fee—using a broker is convenient but adds an unnecessary 300–500 yuan. Factor these expenses into your budget in advance to avoid overspending.
