Higher polluting vehicles face higher taxes

Creation date: 08 September 2009

China plans to slap a tax on tailpipe emissions.
The levy is meant to drive high-polluting vehicles off the roads.

"Automobile emissions have become a main source of air pollution in urban China," said Ren Hongyan, an official from the department of pollution protection under the Ministry of Environmental Protection.

"Drivers, traffic police and pedestrians all suffer from the serious pollution caused by vehicles," he reported on China Economic Net yesterday.
The plan requires the support of the ministry.

The government will gradually push for the removal of about 18 million high-emission vehicles from the roads after Oct 1.

"We will urge hastening the national elimination of high-emission vehicles to accelerate curbing urban air pollution," he said at the 2009 China Vehicle Industry Development Forum.

High-emission cars and trucks make up only 28 percent of all vehicles in China, but they are responsible for 75 percent of emission pollutants, according to the ministry.

Vehicle production reached 9.4 million last year, an increase of 30 times in the past 30 years.
American experts have estimated that production in China may surpass that of the United States, the world's vehicle giant, by 2013 in the wake of the global economic crisis.

According to the automotive industry development plan issued by the central government this March, China aims to increase both production and sales of cars by 10 percent each year from 2009 to 2011.

Xu Changming, an automotive analyst with the State Information Center, said that China should keep its current purchase tax on cars in 2010, according to a report on China Economic Net yesterday.

In January, China halved the purchase tax on smaller, cleaner cars with engine capacities below 1.6 liters to 5 percent until the end of this year.
From January to May, sales of domestic passenger cars with engine capacities below 1.6 liters accounted for nearly 70 percent of total sales, is supposedly a result of the policy.

Source:http://www.chinadaily.com.cn/bizchina/2009-09/08/content_8665303.htm