Lawmaker Proposes Equal Subsidies for Fuel and New Energy Vehicles to Advance "Dual-Track Development"

On March 8, Liu Yiyuan, a National People's Congress deputy and Executive Deputy General Manager of Human Resources and Organization at SAIC Volkswagen, proposed advancing the automotive industry through "coordinated development of fuel-powered and new energy vehicles," advocating for consistent industrial policies and market conditions for both types of vehicles. She recommended unifying subsidy standards without differentiating between fuel-powered and new energy vehicles, while continuing to unlock the consumption potential of new energy vehicles—for example, by promoting their adoption in rural areas and improving the usage environment. Additionally, she suggested extending or making permanent the interest-subsidy policy for auto loans and including car purchase loans in the individual income tax special additional deductions. Currently, new energy vehicles benefit from purchase tax exemptions (capped at RMB 15,000) and higher trade-in subsidies, whereas fuel-powered vehicles must pay full taxes and receive lower subsidies. With the penetration rate of new energy passenger vehicles projected to reach 53.9% in 2025—surpassing fuel-powered vehicle sales for the first time—the industry is calling for "equal treatment" between fuel-powered and new energy vehicles.