China may offer subsidies for electric vehicles

China may offer subsidies and tax exemptions for buyers of energy-saving vehicles in a bid to boost the industry, Reuters reported, quoting an article by Shanghai Securities News. A development proposal submitted to the State Council states that buyers of electric vehicles or hybrid cars would be exempt from a vehicle purchase tax, while EV buyers would get a sales rebate and a reduction in value-added tax. Beijing is also considering subsidies for car purchases by rural residents, similar to the subsidy program that began in 2009. The plan is part of Beijing’s attempt to upgrade the country’s fragmented auto industry and guide the healthy development of its low-emission and environmentally friendly vehicles. It is also expected to drive strong demand for base metals, as China constructs charging facilities for electric vehicles.