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On December 29, the seventh meeting of the Standing Committee of the 13th National People's Congress passed the "Vehicle Purchase Tax Law of the People's Republic of China", which stipulates that the tax rate of vehicle purchase tax in China is 10 percent, which will be implemented on July 1, 2019. At the same time, the Interim Regulations of the People's Republic of China on Vehicle Purchase Tax, which has been in effect for about 18 years, will also be repealed.

There are five types of vehicles that are exempt from vehicle purchase tax. 1. Foreign embassies in China that should be exempt from tax according to the law; 2. Vehicles used by consulates and international organizations in China and their related personnel; (3) Vehicles of the Chinese People's Liberation Army and the Chinese People's Armed Police Force included in the equipment order plan non-transport special operation vehicles with fixed devices; 4. National comprehensive fire rescue vehicles with special emergency rescue plates; 5, the city bus enterprises to purchase public vehicles, such as electric vehicles, the latter two types of vehicles are the law's new clear tax-free vehicle types.

"The vehicle purchase tax plays an important role in organizing fiscal revenue, promoting transportation infrastructure construction and guiding the healthy development of the auto industry," Finance Minister Liu Kun has said. It is understood that since January 1, 2001, China has begun to collect vehicle purchase tax on units and individuals that purchase cars, motorcycles and other vehicles, and the tax rate is 10%. From 2001 to 2017, a total of 2621.4 billion yuan of vehicle purchase tax was collected nationwide, an average annual increase of 17 percent, of which 328.1 billion yuan was collected in 2017.

In January 2009, China for the first time introduced the purchase tax policy of 1.6L and below displacement models, in 2009, China's car market sales rose 46.15%, but the policy has been cancelled since 2011. At the end of October 2015, the purchase tax policy of passenger cars with displacement below 1.6 liters was newly released, and the car market increased by 14.93% year-on-year in the same year. Since 2017, China's vehicle purchase tax preferential policy has been gradually abolished, that is, from 5% to 7.5%, and from 7.5% to the original 10% level since January 2018. From which we can understand the objective information that the car tax policy is not static, but always changing, in line with the pace of economic development of The Times.