What is the vehicle tax rate?

[Dana]

Article 4 of the "Vehicle Purchase Tax Law of the People's Republic of China": The vehicle purchase tax rate is 10%. The vehicle purchase tax is calculated based on the ad valorem rate method. The calculation formula is: Tax payable = Taxable price × Tax rate. If a consumer purchases a domestically produced private vehicle, the taxable price is the total payment made to the dealer, including additional fees, but excluding the value-added tax (VAT) (17% rate). Since the purchase price on the special invoice for vehicle sales includes VAT, the 17% VAT must first be deducted when calculating the vehicle purchase tax. That is, the taxable price for vehicle purchase tax = Invoice price ÷ 1.17, and then the 10% tax rate is applied. The vehicle purchase tax is levied as a one-time payment. If a vehicle has already been subject to the vehicle purchase tax, it will not be levied again. The tax payable for vehicle purchase is calculated by multiplying the taxable price of the vehicle by the tax rate. If the taxable price declared by the taxpayer is significantly low without a valid reason, the tax authority will determine the tax payable in accordance with the "Tax Collection and Administration Law of the People's Republic of China." If the payment for the taxable vehicle is settled in foreign currency, it will be converted into RMB based on the central exchange rate of the RMB on the day of tax declaration. The vehicle purchase tax has a time limit. It must be paid within 60 days from the date of the vehicle purchase invoice. Late payments will incur a daily late fee of 0.05% of the tax amount. After the vehicle purchase tax is paid, the tax authority will issue a "Vehicle Purchase Tax Payment Certificate," which the owner must keep safe and does not need to carry in the vehicle. If the certificate is lost, it must be reissued.

[DeGarrett]

When I bought my first car, I knew nothing about taxes. The dealer told me the purchase tax rate was 10%, which is 10% of the invoice price. For example, a 200,000 yuan car would incur a 20,000 yuan tax. This is a national policy used to regulate consumption and the environment, and sometimes there are discounts for small-displacement vehicles. Additionally, there is an annual vehicle and vessel tax based on engine displacement. Here in Beijing, my small car with a 1.5L engine only costs a little over 400 yuan in tax, while a large-displacement SUV might cost thousands. It’s best to check the tax bureau’s website before buying a car to avoid overspending. If it’s a new energy vehicle, it’s currently tax-exempt, saving a significant amount. Tax rates aren’t fixed—for example, they were reduced during the last economic stimulus period—but 10% is generally the standard. I recommend setting aside an extra 10% for taxes when budgeting for a car purchase, so it doesn’t affect your down payment plans.

[ChaseAnn]

As a daily driver, the most annoying part of car maintenance costs is the vehicle and vessel tax, which is a fixed amount, not a percentage. For example, in Beijing, my small car costs 480 yuan per year, while my neighbor's SUV has to pay over 800 yuan, depending on the engine displacement—smaller engines save on taxes and are more economical. The purchase tax is a one-time 10% when buying the car, and once paid in full, you don't have to worry about it anymore. Policies vary by region: taxes are higher in Beijing, Shanghai, and Guangzhou, while some places offer incentives for new energy vehicles. I suggest car owners check their local tax bureau app to avoid late fees. The tax issue essentially reflects government policies encouraging environmentally friendly vehicles. Adding this expense to your annual budget averages just a few dozen yuan per month, not a big deal.

[ZoeDella]

Vehicle taxes are actually divided into two categories: a 10% purchase tax, which is 10% of the invoice price of a new car. The vehicle and vessel tax is an annual fixed amount, lower for smaller engine displacements. From a financial perspective, these taxes are designed to balance environmental and economic considerations, such as lower taxes for cheaper cars. The 10% tax rate is equivalent to a consumption surcharge, with the government using these funds for road development. Don't be misled by the 13% VAT, which is already included in the car price. When calculating taxes, just refer to the invoice price. Tax rates may sometimes be reduced, so keeping an eye on policies can save money.

[StLeah]

Want to know the car tax rate? Most people ask about the purchase tax, which is 10%. You pay an extra 10% when buying a car. For example, a 100,000 yuan car has a 10,000 yuan tax. The vehicle and vessel tax is a few hundred yuan annually. It's recommended to check the official website or ask a dealer. Download the Auto Treasure APP and enter car details for a quick calculation. Money-saving tip: Buy new energy vehicles for tax exemption or choose small-displacement models to reduce the burden. Tax rates may adjust; last year had a discount period. In short, understand clearly to avoid losses.