Preferential Vehicle and Vessel Tax Policies for Energy-Saving and New Energy Vehicles to be Adjusted Starting Next Year!

Gasgoo Munich- China's Ministry of Finance, the State Taxation Administration, and the Ministry of Industry and Information Technology issued an announcement. Starting January 1, 2027, the policy halving vehicle and vessel tax for energy-efficient vehicles will be abolished. Additionally, the exemption for pure electric commercial vehicles, plug-in hybrids, and fuel cell commercial vehicles will be canceled.

Image source: Official website of the Ministry of Finance

Vehicle and vessel tax is a property tax levied annually on owners or managers of vehicles and ships. Previously, to support the new energy vehicle industry, the Ministry of Finance, the State Taxation Administration, and the Ministry of Industry and Information Technology issued documents. Eligible energy-efficient vehicles received a 50% vehicle and vessel tax reduction. Eligible pure electric, plug-in, and fuel cell commercial vehicles were exempt. This aligns with the "Vehicle and Vessel Tax Law".

Following this policy adjustment, taxpayers must pay vehicle and vessel tax on energy-efficient vehicles, pure electric commercial vehicles, plug-in hybrids, and fuel cell commercial vehicles. This applies to both existing and newly acquired vehicles.

According to the "Vehicle and Vessel Tax Law," pure electric and fuel cell passenger cars are not subject to vehicle and vessel tax.

Officials from the Ministry of Finance, the State Taxation Administration, and the Ministry of Industry and Information Technology responded to reporters' questions. They noted that since 2012, the preferential policy encouraged purchases of new energy and energy-efficient vehicles. It also promoted the development of the automotive industry.

The officials also noted that pure electric commercial vehicles, plug-in hybrids, fuel cell commercial vehicles, and energy-efficient vehicles are all high-value assets, just like other fuel vehicles. According to relevant data, the average selling price of plug-in hybrid passenger cars in 2025 was 218,000 CNY, with some models reaching over 1 million CNY. Resuming the collection of vehicle and vessel tax for these vehicles promotes tax fairness and enhances the regulatory role of taxation on income distribution.

In recent years, China's automotive industry, especially the new energy vehicle sector, has accelerated its development. In 2025, sales of new energy vehicles in China reached 16.49 million units, with the share of new energy vehicles in domestic new car sales exceeding 50%.