Shanghai, December 11 (Gasgoo.com) The Chinese government has launched a raft of new incentives for extending this year's auto boom further into 2010 and even beyond, media reported.
One of the new policies is a 7.5% tax on purchases of cars with an engine of 1.6 liters and below. The new tax is lower than an earlier rate of 10%, which was halved in January to 5% to stimulate a slowing market and has yielded good results.
The extension of the incentive is welcomed by prospective buyers, but they say the current 5% purchase tax is still more favorable. Some are opting to buy a car now to take advantage of the lower tax, CCTV.com said.
"The new policy will surely boost auto sales by the end of the year, because it will increase the spending on cars next year. Some of the car buyers may advance their plans to buy cars in December," said an industry expert.
The further incentives such as tax cuts for small cars and subsidies for clean vehicles will still function in the next year to drive up a steady growth of China's auto sales.
In the first 11 months, 1.8 million more cars with 1.6 liter or smaller engines were sold than a year earlier. China's auto market may grow 15-18% in 2010.
