What taxes need to be paid for a new car?
1 Answers
New cars require the following taxes: 1. Purchase tax: Small-displacement vehicles (below 1.6L) enjoy a 50% reduction in purchase tax; large-displacement vehicles (above 1.8L) receive no discount. 2. Vehicle purchase tax: The tax amount is calculated using the ad valorem rate method. The calculation formula is: Taxable amount = Taxable price × Tax rate. If the consumer purchases a domestic private vehicle, the taxable price includes all payments made to the dealer and additional fees, excluding VAT (17% rate). Since the purchase price on the special motor vehicle sales invoice already includes VAT, the 17% VAT must first be deducted when calculating the vehicle purchase tax. That is: Vehicle purchase tax taxable price = Invoice price ÷ 1.17, then the vehicle purchase tax is calculated at a 10% rate.