China Plans to End Green Vehicle Tax Rebates by 2027

China's finance ministry announced the phasing out of property tax rebates for both energy-efficient combustion engine vehicles and electric vehicles by 2027. The reinstated taxes aim to enhance tax fairness and regulate income distribution.

China's finance ministry revealed on Friday plans to terminate property tax rebates for owners and operators of energy-saving and electric vehicles by 2027. This marks a significant policy shift aimed at adjusting fiscal measures.

The return of vehicle and vessel taxes is seen as a move to bolster tax equality and strengthen the regulatory impact on income distribution, according to the ministry's statement.

Existing since 2012, the current policy halves the annual tax on qualifying fuel-efficient vehicles, while hybrid, battery-powered, and fuel cell commercial vehicles enjoy full exemptions. Pure electric and fuel cell passenger vehicles have not been subject to these emissions-related taxes.