The central government is going to make greater efforts to promote energy-saving eco cars. At the 2009 China Automobile Industry International Forum entitled “Financial Crisis and the Adjustment and Revitalisation of the Automobile Industry” held recently, competent central government departments put forward new ideas for promoting energy saving and emission reduction. According to the sources from the Ministry of Environmental Protection (MEP), it is possible that China may impose pollution tax on vehicles in the future.

This year, car sales in China have been expanding rapidly, and along with it the problem of urban pollution. At present, the levels of nitrogen oxides in many mainland cities are rising, especially along roads and highways. Carbon monoxide, mainly emitted by automobiles, is affecting the health of many people.

According to sources, as adjustments are being made to income tax laws at the moment, the Ministry of Finance, State Administration of Taxation and MEP are jointly looking into the possibility of introducing pollution tax on vehicles. Initially, MEP and other relevant ministries and commissions have endorsed the idea and the Ministry of Finance has yet to conduct a study into the name of the tax and the form of collection.

The next step to be taken by MEP is to further refine the Law on the Prevention and Control of Atmospheric Pollution, in the hope that next year the NPC will pass a more complete statute in this connection. Efforts will also be made to fine-tune the Regulations for the Administration of Automobile Pollution Prevention and the Automobile Pollution Prevention Plan for the 12th Five-Year Programme.

The brand new tax item “automobile pollution prevention tax” is undoubtedly a term strange to consumers and car experts. As such, if this tax is introduced, whether it should be levied at the production stage or consumption stage will be the focus of contention among consumers.