Circular of the Ministry of Finance and the State Administration of Taxation on Reducing Taxation of Consumption Tax on Sedan Cars with Low Pollution Discharge

Circular of the Ministry of Finance and the State Administration of Taxation on Reducing Taxation of Consumption Tax on Sedan Cars with Low Pollution Discharge

Cai Shui [2000] No. 24

June 7, 2000

Finance departments (bureaus) of various provinces, autonomous regions, municipalities directly under the Central Government and cities specially designated in the state plan and the State Administration of Taxation

In order to protect ecological environment, promote the production and consumption of automobiles with low pollution discharge and encourage the progress of technology of the automobile industry, with the approval of the State Council, a policy for reducing taxation of the consumption tax on sedan cars with low pollution discharge is to be implemented. Issues relevant are notified as follows:

Article 1 The consumption tax on the production and sales of sedan cars, cross country vehicles and passenger cars which have attained the limited value of pollution discharge shall be reduced by 30 percent.
The computing formula: The reduced tax amount = the amount of the consumption tax calculated in line with the legal tariff rate x 30 %
The dutiable amount = The consumption tax amount calculated in accordance with the legal tax rates - the reduced tax amount
The limited value of low pollution discharge is equivalent to the 94/12/EC, 96/69/EC discharge standard instructed by the European Communities ("the European No. II Standard" for short).

Article 2 Automobile production enterprises shall directly file an application to the Ministry of Finance and the State Adiministration Taxation for the reduction of the consumption tax and, at the same time, submit the application to the State MachineBuilding Industry Bureau and the State Environmental Protection Administration.
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