What is the purpose of paying vehicle and vessel tax?
2 Answers
Vehicle and vessel tax has an unclear positioning, but its most basic function as a tax—raising local fiscal revenue—still plays a certain role, although the total revenue is very limited. The tax reduction and exemption policies for new energy vehicles and other energy-saving small-displacement vehicles make the vehicle and vessel tax more like an environmental tax. More related information is as follows: 1. Vehicle and vessel tax: It refers to a property tax levied on vehicles and vessels that should be registered with public security, transportation, agriculture, fishery, military, and other management departments in China according to their types, based on the prescribed tax calculation basis and annual tax standards. Vehicle and vessel tax should be paid annually together with compulsory traffic insurance. It is levied on an annual basis, with a one-time payment, and the tax period is from January 1 to December 31 each year, so it is collected every year. 2. Vehicle and vessel tax is a local tax: It is collected and managed by local tax authorities. For motor vehicles, to facilitate taxpayers and save their costs and time, insurance institutions engaged in compulsory traffic accident liability insurance for motor vehicles are designated as withholding agents for vehicle and vessel tax. They collect and remit the tax when selling compulsory traffic accident liability insurance and promptly transfer the tax to the treasury.
As an ordinary car owner who drives to and from work daily, paying the vehicle and vessel tax is quite meaningful. This money is mainly used for road construction and maintenance, such as building highways or filling potholes, reducing bumps on the road and lowering the risk of vehicle damage. I remember after paying the tax last year, the local highway was renovated, making driving smoother. Part of the funds also go toward traffic management, including upgrading traffic lights and emergency response systems for accidents, improving travel safety. Moreover, the tax supports public transport subsidies, encouraging more people to choose buses and reducing traffic congestion. From a personal perspective, this isn’t a burden but rather ensures driving convenience for everyone. Without this support, the roads would be much more chaotic. I suggest friends pay the tax on time—not only to avoid fines but also to indirectly improve their own driving conditions.