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Tax Incentives For Chinese Autos Continue To Boost Sales

by Mary Swire, Tax-News.com, Hong Kong

14 May 2009

Car sales in China have jumped 37% on the back of tax breaks designed to spur growth in the industry.

According to figures released by the China Association of Automobile Manufacturers, the total sale of vehicles within the country rose 25% to reach 1.15 million last month. China is currently the largest automotive market in the world.

Car sales began to slow at the end of last year when the global financial crisis hit.

The government set about stimulating growth in the industry by reducing the purchase tax levied on small-engined cars, by half, and by reducing toll-road tariffs.

Auto sales have risen for five consecutive months in light of these measures.

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