China raises sales tax on big cars
14 August 2008
China's Finance Ministry announced it would raise the sales taxes on large automobiles and cut taxes on smaller cars to promote more fuel-efficient models and combat emissions, Bloomberg reported. The tax on passenger vehicles with engines bigger than 4 liters will jump from 20% to 40%, while the tax on cars with engines sized from 2-4 liters will increase from 15% to 25%. Cars with engines of 1-liter capacity or less will see their tax rate fall from 3% to 1%. The changes will be effective September 1. The sales of sedans with engines between 3 and 4 liters rose six-fold last year to 12,100 units, while cars with engines less than 1 liter fell 31% to 251,700, according to the China Association of Automobile Manufacturers.