Price of profligacy

Should oil-guzzling motor vehicles and their smaller counterparts that consume much less oil pay the same rate of consumption tax while enjoying the same low level of oil prices subsidized by the government?

A notice released by the State Council by the weekend is the right answer to this question. It requires that the consumption tax rate for oil guzzlers be raised while that for cars consuming much less be lowered down. It says that the consumption tax will be imposed on cars in line with the amount of oil they consume - the more energy a car consumes, the higher rate of tax it will have to pay. The tax gap will be gradually increased between oil guzzlers and energy-efficient motor vehicles.

With soaring oil prices in the international market, the sale of SUV (sport utility vehicles) has been on the decrease in some developed countries; but it has been a totally different case in China. The import of SUVs from January to May increased by 50 percent over the same period of last year.