September 12， 2025 – News from Kuaikeji. The recent announcement that “the policy of exemption from purchase tax for new energy vehicles will end in January 2026” has garnered significant attention.
Cui Dongshu， Secretary-General of the CPCA (China Passenger Car Association)， commented in an interview， stating that “there is a high probability that new energy vehicles will be subject to a 5% purchase tax starting next year. This is because relevant authorities had previously issued a policy in 2023 clearly stipulating that new energy vehicles purchased between January 1， 2026， and December 31， 2027， will have their vehicle purchase tax halved.”
Cui Dongshu further elaborated that “if the tax reduction policy for new energy vehicles continues next year， the tax pressure will inevitably increase due to the substantial volume of new energy vehicles.”
It is understood that as early as June 2023， a joint announcement was made by the Ministry of Finance， the State Taxation Administration， and the Ministry of Industry and Information Technology on “Continuing and Optimizing the Policy of Halving and Exempting Vehicle Purchase Tax for New Energy Vehicles，” which clearly outlined the following:
New energy vehicles purchased between January 1， 2024， and December 31， 2025， will be exempt from vehicle purchase tax. The exemption amount for each new energy passenger car will not exceed 30，000 yuan.
For new energy vehicles purchased between January 1， 2026， and December 31， 2027， the vehicle purchase tax will be halved. The reduced tax amount for each new energy passenger car will not exceed 15，000 yuan.
Currently， China’s vehicle purchase tax rate stands at 10%. Therefore， if the purchase tax is halved， it means that the actual tax rate levied on new energy vehicles will remain at the 5% level.
Furthermore， data released by the CPCA indicates that from January to August 2025， the cumulative retail sales of new energy passenger vehicles in China reached 7.556 million units， representing a year-on-year increase of 7.5%. The retail penetration rate has reached 51%. This signifies a gradual shift in the domestic new car market from predominantly internal combustion engine vehicles to new energy vehicles.
