China might levy pollution tax on vehicles, Ren Hongyan, director of the Department of Pollution Control of the Ministry of Environmental Protection, said during a discussion on “Energy saving and traditional energy automobiles” at the 2009 International Forum on Chinese Automotive Industry Development held over the weekend in Tianjin, according to China Economic Net (www.ce.cn).
Ren said since the Income Tax Law of the People’s Republic of China is being revised, the Ministry of Finance and the State Administration of Taxation have reached an agreement with the Ministry of Environmental Protection to include a pollution tax or environmental tax on vehicles in the new income tax law. The Ministry of Finance must now research ways to implement the new tax policy.
The consensus at the forum was that China is likely to keep a low purchase tax on small-capacity cars next year. China cut the purchase tax on passenger cars to 5 percent for models with engine displacements of less than 1.6 liters in January, the economic net said.