New Energy Vehicles to Lose Annual Vehicle Tax Exemption Starting 2027

Starting January 1, 2027, energy-efficient vehicles, battery electric and fuel cell commercial vehicles, and plug-in hybrid electric vehicles (including range-extended models) will no longer be exempt from the vehicle and vessel tax. According to a notice issued on July 3 by the Ministry of Finance, the State Taxation Administration, and the Ministry of Industry and Information Technology, owners or managers of these vehicles will be required to pay the annual vehicle and vessel tax as stipulated. The vehicle and vessel tax is a property tax levied annually. For passenger vehicles with a certified seating capacity of nine or fewer persons, the tax is calculated in brackets based on engine displacement, ranging from RMB 60 to RMB 5,400 per year. Buses with a certified seating capacity of more than nine persons are taxed per vehicle, with annual rates between RMB 480 and RMB 1,440. Trucks are taxed per ton of curb weight, at annual rates from RMB 16 to RMB 120. Local governments may set specific applicable tax rates within these prescribed ranges.