Changes for Vehicle Excise Tax to Save Energy    

According to the news released by the Ministry of Finance and the State Taxation Administration, China will increase the excise tax for passenger vehicles with larger displacement volume and reduce that of vehicles with small displacement volume so as to reduce the consumption of gasoline and diesel and minimize the pollution to atmosphere, effective September 1st, 2008.
   The excise tax will be raised from 15% to 25% for passenger vehicles with a displacement volume of over 3.0 L to 4.0 L (inclusive), up from 20% to 40% for passenger vehicles with a displacement volume of over 4.0 L. The excise tax for passenger vehicles with a displacement volume of below 1.0 L (inclusive) will be lowered from 3% to 1%.
   According to the Ministry of Finance, the automobile industry is a major source for energy consumption and pollutant emission in China. The total amount of vehicles in China has greatly increased in recent years. The growing demand for gasoline and diesel has aggravated pollution to atmosphere. Faced with the increasing imports of crude oil, energy supply safety has also become more urgent. China must therefore intensify energy-saving and emission-reducing in the automobile sector.
   The move aims to contain the production and consumption of vehicles with larger displacement volume and encourage that with small displacement volume.