How to Calculate Vehicle Purchase Tax in 2020?
4 Answers
The calculation formula is: Tax Payable = Taxable Price × Tax Rate. The taxable price includes all payments and additional fees paid to the dealer, excluding VAT (17% tax rate). According to the "Notice on Reducing Vehicle Purchase Tax for Passenger Vehicles with 1.6L or Below Displacement" issued by the Ministry of Finance, it is clearly stated that starting from January 1, 2018, the vehicle purchase tax will be levied at the statutory rate of 10%. This means that there are no more purchase tax incentives like those in 2017. Notes on vehicle purchase tax calculation are as follows: 1. For taxpayers purchasing vehicles for personal use, tax declaration must be made within 60 days from the purchase date; for imported vehicles for personal use, tax declaration must be made within 60 days from the import date. 2. For vehicles obtained through self-production, gifts, awards, or other means for personal use, tax declaration must be made within 60 days from the acquisition date. The following documents are required for vehicle purchase tax payment: 1. Taxpayer identification. 2. Vehicle price proof. 3. Vehicle certification. 4. Other documents required by the tax authority.
When I bought a car in 2020, the calculation of the purchase tax was actually quite straightforward. The tax rate is basically 10% of the car's price, and most fuel-powered vehicles are taxed at this rate. Specifically, you need to deduct the value-added tax (VAT) portion from the price on the purchase invoice—the VAT rate is 13%, so the calculation formula is the purchase price divided by 1.13 and then multiplied by 0.1. For example, my friend bought a car for 200,000 yuan, with a tax base of about 177,000 yuan, resulting in a tax payment of over 17,000 yuan. However, when actually purchasing, the 4S store or the vehicle management office will calculate it for you, and you just need to pay directly, which is much more convenient. Don’t forget that for new energy vehicles like electric cars, the 2020 policy offered significant benefits—full exemption from purchase tax, so choosing such a car could save you a lot of money. The policy hasn’t changed much, maintaining the standard tax rate, but it’s advisable to check official sources or ask the salesperson about the tax amount before buying, in case there are discounts for specific models. Overall, there’s no need to calculate too precisely—knowing that it’s roughly 10% of the cost is enough to handle it.
Last year when I purchased my car, the 2020 purchase tax was simply calculated by multiplying 0.1. The salesperson directly quoted the tax amount: 10% of the ex-factory price. I spent 180,000 yuan on a gasoline car, with 18,000 yuan in tax, all included in the total price. The process wasn't complicated, as the tax was collected by the vehicle management office. However, note that new energy vehicles like electric cars are fully tax-exempt, making them a more cost-effective option. The policy is quite stable, with the tax rate consistently at 10% unless it's a special vehicle model. Just be clear about your budget, and don't worry about the calculations. My experience is to double-check the tax invoice after payment. I often research and found that small-displacement vehicles occasionally have local subsidies, which can reduce the tax burden, but the mainstream situation in 2020 was standard. Overall, manage your expenses well, and taxes won't be a concern.
To calculate the purchase tax, the 2020 rate is 10%, simply multiply the car price by 0.1. Just multiply the invoice price by 10%, and the 4S store will handle the tax payment. New energy vehicles are tax-exempt and do not require payment. Simple payment saves hassle.
