China Extends Electric Vehicle Tax Rebate

Thank goodness our latest tax bill kept the renewable energy incentives – China is making a huge play for this increasingly mainstream market (in their own country, anyway). The People’s Republic extended a tax rebate for “new-energy vehicles” through the end of 2020.

China extended the 10% rebate (up to $9,800) – previously set to expire at the end of 2017 – on electric, plug-in petrol-electric hybrid, and fuel-cell powered vehicles. Why such generosity?

For one, a number of government quotas are bearing down on local and foreign automakers – including a sales target of 5 million new energy vehicles by 2020. In addition, automakers have to hit cap-and-trade NEV credit scores of at least 10 percent in 2019 and 12 percent in 2020 or face fines.  

But there’s a far more selfish reason for the rebate extension. The Business Globalist put it succinctly:

“China has become the world’s largest automotive market, but local firms still can’t compete worldwide with big brands as General Motors, BMW, Mercedes or Audi, and Beijing’s government wants to catch up global automaker rivals.”

Of course, the inability of China’s domestic auto industry to compete on the world stage could also have something to do with its general crumminess (who chooses SAIC Motor or Dongfeng over GM, Hyundai, or Toyota?), but never mind that....