What taxes are required when purchasing an imported car?
3 Answers
When purchasing an imported car, the taxes required include customs duty, value-added tax (VAT), and consumption tax. The process for licensing an imported car is as follows: 1. Prepare the necessary documents. For individual ownership, bring your ID card and a copy; for corporate ownership, bring the original and a copy of the company's unified social credit code business license. 2. Purchase compulsory traffic insurance, which can be obtained from any insurance company. 3. Take the insurance policy, customs declaration, inspection certificate, and invoice to the local industrial and commercial bureau for verification and stamping. 4. Go to the local tax bureau to pay the vehicle purchase tax. 5. Bring all the documents to the vehicle management office for stamping, photographing, and vehicle inspection. Important considerations when purchasing an imported car: 1. Certificate of imported goods; 2. Vehicle inspection report; 3. Vehicle conformity certificate; 4. Vehicle purchase invoice; 5. Electronic information of the imported vehicle.
To be honest, the taxes on imported cars are really substantial. First, there's the customs duty, which is currently 15% for regular imported vehicles, though it depends on the engine displacement. Then there's the crucial consumption tax, which is tightly linked to engine size. Cars under 2.0L are taxed less, but the tax increases significantly with larger displacements. Additionally, there's a 13% value-added tax (VAT) waiting to be levied. The key point is that these three taxes are calculated cumulatively. For example, the customs duty is added first, then the consumption tax is calculated based on the price including the customs duty, and finally the VAT is calculated based on the price that now includes the consumption tax. There's also a purchase tax, which is paid when registering the vehicle and amounts to 10% of the car's price. Some vehicles that exceed emission standards may also be subject to an environmental tax. For parallel-imported cars, the taxes might be slightly lower, but the insurance costs are generally higher.
The total price of an imported car consists of the landed price plus several taxes. There are three core taxes: customs duty (15%), consumption tax (tiered taxation), and value-added tax (13%). The engine displacement tax is crucial—5% for 1.5-2.0L, 9% for 2.0-2.5L, a sharp jump to 25% for 3.0-4.0L, and 40% for engines above 4.0L. These taxes aren't calculated separately based on the original price; instead, the customs duty is added to the original price to calculate the consumption tax, and then the value-added tax is applied to the sum of the first two. Finally, a vehicle purchase tax (10% of the transaction price) is paid during vehicle registration. For high-displacement vehicles, taxes often exceed 50% of the car's base price.
