Is Vehicle and Vessel Tax Mandatory with Compulsory Traffic Insurance?
2 Answers
Compulsory traffic insurance does not include vehicle and vessel tax. The nature of the two is different. When paying for compulsory traffic insurance, the vehicle and vessel tax will be collected together. The reason for collecting them together is a measure taken by the state to reduce the burden on taxpayers. To avoid car owners having to travel back and forth between insurance companies and local tax bureaus, the tax authorities require insurance companies to collect the vehicle and vessel tax when collecting compulsory traffic insurance fees. Here is extended information about compulsory traffic insurance and vehicle and vessel tax: 1. Vehicle and vessel tax refers to a property tax levied on vehicles and ships that are legally registered with public security, transportation, agriculture, fisheries, military, and other management departments within China, calculated based on their type, according to the prescribed tax basis and annual tax standards. 2. Compulsory traffic insurance, also known as compulsory motor vehicle traffic accident liability insurance, is clearly defined in China's "Regulations on Compulsory Motor Vehicle Traffic Accident Liability Insurance" regarding its compensation scope. It is a mandatory liability insurance where the insurance company compensates for personal injuries, deaths, and property losses of victims other than the vehicle occupants and the insured within the liability limits for road traffic accidents caused by the insured motor vehicle.
As an ordinary car owner, I must share my experience. Every time I purchase compulsory traffic insurance, the vehicle and vessel tax must be paid together, otherwise the policy is completely invalid. Last year when I bought car insurance, the insurance company staff directly told me at the counter that these two items must be paid as a bundle - it's a government regulation that the vehicle and vessel tax must be paid through the compulsory insurance channel, otherwise you won't pass the annual vehicle inspection at the DMV. The vehicle and vessel tax is calculated based on the vehicle's displacement - for my small-displacement car it's just a few hundred yuan. If you don't pay, you'll face fines and it will affect your credit record. I suggest everyone carefully check the payment deadline when buying insurance - paying early avoids trouble and prevents unnecessary extra costs later. Also, the vehicle and vessel tax is a local tax, so standards vary slightly by region. Before buying a new car or renewing insurance, it's best to check local policies and keep records to avoid getting tickets.
