Sorry, but I’m in a kind of tiredness that saps my ability to concentrate, so I might take a lot longer to write up this post than usual, and may make more than a few mistakes, but the headline really grabbed my attention, and the first paragraph or two raised the question:

Just how many contradictory birds can be killed with one stone?

Some of the article strikes me as either dead boring or completely irrelevant (irrelevant to any of my interests, that is), so I won’t translate the whole thing, just look at the points that seem salient to me.

The big news is a cut of 5% on sales tax on vehicles with an engine capacity of 1.6 litres or less. That is a halving of said sales tax, from 10 to 5%. The reasons given are:

为培育市场,稳定和扩大汽车消费需求,规划提出,从今年1月20日至12月31日,对1.6升及以下排量乘用车减按5%征收车辆购置税。目前,车辆的购置税是10%。

To nurture the market, stabilise and broaden demand for cars, the plan proposes that from January 20 to December 31, sales tax on low emission passenger vehicles with an engine capacity of 1.6 litres or less will be cut by 5%. Currently sales tax on such vehicles is 10%.

Yes, as you can see, I have added a fair bit into the English to help me make sense of the whole thing. Please correct me if I have misinterpreted anything.

But this raises questions in my mind:

  1. How firm and direct is the connection between engine size and emissions? I mean, I know smaller engines are generally more fuel efficient and therefore emit less exhaust, but surely fuel efficiency is a matter of “bang for your buck”? Surely a well-designed 2.5 litre V6 could be just as efficient and emit as little as a rough-as-guts 1.6 litre straight 4? Or is there a point (say, 1.6 litres) at which engine size = low fuel consumption = less emissions regardless of all other considerations?
  2. Clearly the 1.6 litre/low emissions thing is about cutting vehicle exhaust and therefore air pollution. But how do you encourage buying of cars (albeit low-emission vehicles) while cutting air pollution?

I’m asking these questions because I really don’t understand the engineering and science that would explain these things.

But there’s also good news for the rural population:

此外,根据规划,从今年3月1日至12月31日,国家安排50亿元对农民报废三轮汽车,低速货车换购轻型载货车,以及购买1.3升以下排量的微型客车,给予一次性财政补贴。同时,增加老旧汽车报废更新补贴资金,并清理取消限购汽车的不合理规定。

In addition, according to the plan, from March 1 to December 31, the state will arrange 5 billion yuan in one time only subsidies to help farmers discard tricycles or trade in low quality vehicles for new light commercials, as well as buy light passenger vehicles of 1.3 litres or less. At the same time, subsidies for trading in old vehicles will be increased and unreasonable rules limiting the purchase of vehicles will be cleaned up or cancelled.

Notes: “Tricycles” most likely refers to three-wheeled motor vehicles of a similar design to utes/pick up trucks, used to carry stuff mostly in rural areas, but also around the fringes of cities. “Light commercial” is the term I remember from New Zealand referring to utes/pick ups, vans, and similar such vehicles designed for commercial/stuff carrying purposes, but smaller than even light trucks. It seems to fit what is written in Chinese. As always, corrections are most welcome.

“Unreasonable rules limiting the purchase of vehicles”? What rules would that refer to?

Now, among four measures to be adopted for car producers, the article mentions;

今后三年,中央安排100亿元专项资金,重点支持技术创新、新能源汽车发展等;实施新能源汽车战略。

Over the next three years the central government will set up a special fund of 10 billion yuan focussed on support for innovative technologies and development of new energy vehicles and the realisation of a strategy for new energy vehicles.

中央安排补贴资金,支持节能和新能源汽车在大中城市示范推广。

The central government will set up subsidies to support the popularisation of energy saving and new energy vehicles on the large- and medium-sized city scale.

Subsidies for fuel efficient and new energy cars, that’s pretty damn awesome.

Now here’s what I don’t get: Selling more cars means more cars on the road means (unless the new cars are all of the zero emission kind) more air pollution, regardless of how fuel efficient they may be. Even if they are all zero emission, they’re still adding to the kind of gridlock that is already holding back the economy in places like Beijing (no, I don’t have statistics to back up that last claim, please correct me if I’m wrong). And yet this new set of measures seems to be aimed at both boosting the economy and improving the environment. Clearly more sales of domestically produced cars will help China’s economy, but more cars equals worse gridlock equals brake on the domestic economy; and more cars (unless they’re zero emission) equals more air pollution. And yet there’s a clear emphasis on low emissions and new, more environmentally friendly technology. I am struggling to see how all these competing demands balance out.

And I have to admit to my own particular contradiction: My wife and I would love to buy a car, and a Suzuki SX4 would seem to meet best our particular requirements for price, size, and space, and falls within that 1.6 litre limit…. Although, we have not done any more research than looking and thinking, hey, that’s pretty cool and about the size and price we want. Basically we would want something with space for a small family, small enough for city life and cut down fuel bills and emissions, big enough for getting across the mountains to Yanqing. So if we had the cash, we’d be right smack in the middle of the target of these measures. And quite possibly by mid-year we will have the cash to put down a deposit…… But I really don’t want to add to the already noxious air pollution and terrible traffic….. but I would love the freedom of crossing the Jundushan in my own car, taking the back roads, playing round a bit….

So I’m a little conflicted about the whole thing.

And let me just emphasise that every question I have asked and everything I have mistranslated is a call for answers. If you can help me better understand these issues, leave a comment.

2 Responses to “sales tax cut on low emission vehicles”

  1. Nick Says:

    I think the subsidies to replace the tricycles is fantastic. I agree, we could do without every Chinese man and his dog driving a car.

    I’m amazed ht how far China’s long distance, especially rail, public transport system has come.

  2. wangbo Says:

    And as good as the system is, they just keep improving it. Sometimes I think we should outsource NZ’s government to China- at least those parts of it that handle transportation.