Will the Vehicle Purchase Tax Be Abolished in 2021?
2 Answers
The vehicle purchase tax is only abolished for some models. From January 1, 2021, to December 31, 2022, the purchase tax will be exempted for new energy vehicles. New energy vehicles exempt from the purchase tax include pure electric vehicles, plug-in hybrid (including range-extended) vehicles, and fuel cell vehicles. Below is the classification of new energy vehicles by power type: Hybrid: Hybrid vehicles are those that use traditional fuels and are equipped with an electric motor/engine to improve low-speed power output and fuel consumption. Based on whether they can be externally charged, they can be further divided into plug-in hybrid electric vehicles (PHEV) and non-plug-in hybrid electric vehicles (MHEV). Pure Electric: As the name suggests, electric vehicles primarily rely on electric power for propulsion. Most vehicles use electric motors directly for driving, while some have motors installed in the engine compartment, and others use the wheels as the rotors for four electric motors. Fuel Cell: Fuel cell vehicles refer to those that use hydrogen, methanol, etc., as fuel, generate electric current through chemical reactions, and rely on electric motors for propulsion.
Was the vehicle purchase tax abolished in 2021? It depends on what car you buy. I happened to switch to a pure electric vehicle at that time and didn’t pay a single penny in purchase tax because the national policy clearly exempts new energy vehicles from this tax. However, if you buy a fuel-powered car, like my colleague who chose an Accord, he still dutifully paid 10% of the car’s price as tax. This tax exemption policy actually started in 2014 and continued in 2021, mainly to promote electric vehicles. I specifically checked back then—only pure electric or plug-in hybrid models qualify for the exemption, and they must be listed in the tax-free catalog. If you buy a used new energy vehicle or an imported car, you should also pay attention to the policy details in some cases. By the way, the savings from this tax exemption are quite substantial—I saved over 17,000 yuan directly on my 200,000-yuan car!
