China extends tax breaks for clean energy cars until 2027

On Wednesday, the Chinese government announced extending tax breaks for consumers who buy cars powered by clean energy sources until the end of 2027. The total value of these tax breaks is estimated to be 520 billion yuan ($72.3 billion) over the next four years, a move aimed at supporting China’s electric vehicle industry.

The government announced the move in a press briefing published today in Beijing, the latest in a series of measures aimed at increasing production and sales in the world’s largest electric vehicle market.

China’s Ministry of Industry and Information Technology said that despite China’s achievements in the clean energy vehicle industry, the sector continues to face problems including inadequate supplies of biotechnological components and uneven market development.

The exemption was recently extended until the end of the 2023 before the Government announced today that the exemption would be extended until the end of the 2025 for cars priced at less than 300 thousand yuan ($ 41.7 thousand), with no more than 8 passengers. The exemption will continue until the end of the 2027 for cars priced at less than 150 thousand yuan.