By extending the tax rebate on NEVs upto December 31, 2020, China aims to provide a financial support structure for green vehicles.
In efforts aimed at boosting the adoption of hybrid and electric cars, China stated it will extend its tax rebate on the purchase of these new-energy vehicles (NEV) until the end of 2020.
On Wednesday, China’s finance ministry stated that the tax exemption, which was set to expire at the end of 2017, will be extended up to December 31, 2020.
The tax exemption will be applicable for electric, plug-in petrol-electric hybrid and fuel-cell powered vehicles.
These exemptions come in the wake of Chinese automakers bracing to meet strict NEV quotas that begin in 2019 and have sparked a flurry of electric car deals and new launches of EV and and hybrid models.
Midst this transition, global automakers have also called on Beijing to provide some sort of a financial support for the market saying consumer demand alone will not be sufficient to drive sales without state-backed incentive schemes to lure buyers.
China’s Ministry of Finance said, the extension of the tax rebate will help “increase support for innovation and development in new energy vehicles”.
Home to the world’s biggest auto market, the sale of cars in China has slowed down this year, however the sale of NEVs has been a bright spot with NEV sales jumping by 51.4% between the November and January period and are on track to meet the 700,000 NEV sales target for this year.