How to Calculate Purchase Tax and Vehicle and Vessel Tax?
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Vehicle purchase tax is calculated based on a price-based rate to determine the taxable amount, with the calculation formula being: Taxable Amount = Taxable Price × Tax Rate. Vehicle and vessel tax is calculated based on a fixed amount to determine the taxable amount, with the calculation formula being: Taxable Amount = Annual Taxable Amount ÷ 12 × Number of Taxable Months. The following is an introduction to vehicle purchase tax and vehicle and vessel tax: 1. Vehicle purchase tax is a tax levied on the purchase of specified vehicles within China, imposed on vehicle purchasers at specific stages. Its taxpayers are units and individuals who purchase vehicles within China, where 'purchase' refers to the act of buying for use, importing for use, receiving as a gift for use, self-producing for use, winning as a prize for use, as well as obtaining and using through auction, debt settlement, smuggling, confiscation, etc. 2. Vehicle and vessel tax refers to a tax that owners or managers of vehicles and vessels within the People's Republic of China are required to pay according to the Provisional Regulations on Vehicle and Vessel Tax of the People's Republic of China. Its taxpayers are owners or managers of vehicles and vessels within China. Motor vehicle and vessel tax should be paid at the same time as applying for compulsory motor vehicle insurance.
When purchasing a car, the purchase tax is generally calculated at 10% of the invoice price. For example, if your car costs 150,000 yuan, the tax would be 15,000 yuan. The vehicle and vessel tax, on the other hand, is paid annually and mainly depends on your car's displacement. For small-displacement cars, such as those below 1.6L, it might be a few hundred yuan per year, while larger-displacement SUVs are much more expensive, possibly costing several thousand yuan. I remember last time when helping a friend choose a car, after careful comparison, we found that new energy vehicles enjoy purchase tax exemptions and lower vehicle and vessel taxes, which saved a significant amount of money. Additionally, it aligns with environmental policies, as gasoline cars tend to pollute more. Be sure to calculate these costs before buying a car to avoid exceeding your budget due to unexpected total expenses. Before driving your new car home, it's also advisable to consult the local vehicle management office, as vehicle and vessel tax standards vary by region. For instance, cities like Beijing, Shanghai, and Guangzhou might have higher rates.
The purchase tax is relatively straightforward, generally around 10% of the car's invoice price. The vehicle and vessel tax is a fixed annual payment—smaller engine displacement means lower costs. For a 1.0L car, it might be 200-300 yuan per year, while for engines above 2.0L, the tax can quickly rise to nearly 1,000 yuan. I paid special attention to this when choosing a car. High-displacement cars are fun to drive but come with high taxes, and when you add fuel costs, the total ownership expenses can be quite steep. Fortunately, current policies offer incentives for energy-efficient vehicles, such as partial exemptions on purchase taxes for plug-in hybrids or pure electric cars, as well as discounts on the vehicle and vessel tax. Doing thorough research before buying can save you a lot of hassle. For those on a tight budget, it's best to prioritize small-displacement or new energy models to avoid high ongoing costs.
