Is There a Purchase Tax Reduction Policy for Small-Displacement Vehicles in 2021?
3 Answers
2021 does not have a half-price car purchase tax policy. Relevant information: Although China has indeed implemented a fuel vehicle purchase tax reduction in history, the policy was limited to the period from October 1, 2015, to December 31, 2017. During these two years, a 50% reduction in the purchase tax was applied to passenger vehicles with a displacement of 1.6 liters or below. Starting from January 1, 2018, the statutory purchase tax rate of 10% was reinstated. Purchase tax collection time: Currently, ordinary fuel vehicles are subject to a 10% purchase tax in accordance with the "People's Republic of China Vehicle Purchase Tax Law," which officially came into effect on July 1, 2019. This law clearly states that a 10% statutory tax rate is required for vehicle purchase tax. Generally, changing a law is a relatively difficult process, so there will be no half-price policy introduced for fuel vehicles purchased in 2021, nor will the purchase tax be canceled.
I remember there was indeed no nationwide purchase tax reduction policy for small-displacement vehicles in 2021. Back in 2015-2017, fuel-powered cars below 1.6 liters could enjoy tax exemptions, but the rate returned to 10% starting from 2018. Last year when helping a friend car shopping, I checked very clearly that only new energy vehicles qualify for tax exemption now. However, a tip is to watch for local policies - like Guangdong had car purchase subsidies last year, and some brands also offer trade-in subsidies. If you really want to save money, I'd suggest focusing on hybrid or pure electric models. With tax exemptions plus manufacturer discounts, they can sometimes be more cost-effective than small-displacement fuel cars. If you must buy a fuel vehicle, choosing around 1.5T displacement offers a good balance between power and fuel consumption.
In 2021, if you buy a small-displacement car, the purchase tax is indeed charged according to the standard rate. I know the policy changes very well because I just changed my car last year. After 2017, the tax reduction for vehicles under 1.6 liters was canceled nationwide, and now there's a unified 10% tax rate. However, in practice, different brands have different strategies. Some 4S stores may offer discounts of several thousand yuan through trade-in subsidies. If you live in an area with license plate restrictions, you might want to consider new energy vehicles, which are exempt from purchase tax and come with free license plates. It's advisable to visit several 4S stores to inquire about recent promotions, as some places offer additional subsidies to stimulate consumption.
