Under the regulation, a 10 percent purchase tax rate will be levied on all vehicle purchases, including new car purchase, import, reward and gift. The new tax will not have much impact on the car price because it remains almost the same as the current purchasing fees.

Car owners should pay the tax within 60 days from the date of purchase, and traffic administrative office under the public security departments will not issue licences if owners fail to pay the tax.

According to the regulation, vehicle purchases by foreign diplomats, the People's Liberation Army and the People's Armed Police Force are exempt from the tax.

With the vehicle-related tax scheme, the government is aiming at creating a better consumption environment.

Fuel tax, another part of the scheme to replace the existing road maintenance fees, however, would be delayed for at least another half year, according to the Ministry of Communications. The ministry said road maintenance fees will continue to be collected in the first half of next year.

(China Daily 11/17/2000)