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Policy being Drafted to Encourage Purchase of Cars
A policy to encourage individuals to purchase cars and do away with restrictions on car use is currently being drafted by relevant government departments.
Currently, companies purchase most cars in China because the relatively high prices of cars make them unaffordable for the average Chinese family.
The "car purchase" policy will be two-pronged: 1) encourage individual to buy cars, especially energy efficient and compact cars and 2) eliminate restrictions on using cars throughout China.
The proposed "car purchase" policy also includes the following measures:
The tax measures will cut taxes on cars and simplify the tax collection procedures.
The municipal planning measures will primarily work to coordinate the needs of the city and transportation. In the future, all new buildings must allocate a certain amount of space for parking lots. And all parking lot fees must be uniform. Cars that exceed pollution and safety standards will be scrapped.
The car loans policy will be improved. Financial institutions will be encouraged to use mortgages, deposits and compulsory insurance guarantees as collateral for loans to buy cars.
The policy will adopt measures to encourage the sales of low emission compact cars. For one, there will be a discrepancy in tax rates on compact cars and larger cars. Larger cities will be permitted to limit the number of cars allowed to drive in the city, but low emission compact cars will be exempt from this restriction.
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