Plug-in and Extended-Range Hybrid Vehicles to Lose Vehicle Tax Exemption Starting 2027

The Ministry of Finance, the State Taxation Administration, and the Ministry of Industry and Information Technology jointly issued an announcement stating that, effective January 1, 2027, the policy of halving vehicle and vessel tax for energy-saving vehicles will be terminated. Additionally, the exemption from vehicle and vessel tax for pure electric commercial vehicles, plug-in (including range-extended) hybrid electric vehicles, and fuel cell commercial vehicles will also be discontinued. From that date onward, taxpayers—whether they acquired the aforementioned types of vehicles prior to or after the effective date—must pay vehicle and vessel tax in accordance with the relevant provisions of the "Vehicle and Vessel Tax Law of the People's Republic of China" and its implementing regulations. Furthermore, the relevant provisions of the former "Notice on Preferential Vehicle and Vessel Tax Policies for Energy-Saving and New Energy Vehicles and Vessels" (Cai Shui [2018] No. 74) will be repealed as of that date.