CHINA: Provincial official suggests tax-paying threshold for vehicle buyers
The days of unrestricted new vehicle buying could be numbered, at least in some parts of China
More restrictions on who can buy new cars may be on the way for China. Following recent news of new rules for Beijing, comes a local report citing Zhejiang Provincial Committee member Zhou Jianqiao as saying: "Only businesses or individuals paying over CNY50,000 (US$7,600) of taxes annually should be allowed to purchase a vehicle."
According to Gasgoo.com, Zhou, in his "proposal regarding how to resolve traffic congestion problems" submitted to the fourth session of the 10th Provincial People's Congress, said the reason behind the current levels of traffic congestion is the rapid increase in the number of privately-owned automobiles, advocating that tax evaders and others who do not pay tax be prohibited from purchasing a car.
"Those who] do not supply taxes to the state, yet give the state additionally burdens, should not be allowed to purchase a vehicle," he said. Zhou also suggested that buying cars be limited to businesses and individuals paying at least 50,000 yuan ($7.590) in taxes annually.
According to the report, Zhou calculated the CNY50,000 threshold on an individual tax rate of 20% as, according to his logic, those paying at least CNY50,000 in taxes have an annual income of over CNY250,000 ($37,950).
"To buy a mid-class car right now, including paying related operating expenses requires around CNY200,000 yuan ($30,360). However those who buy economically priced vehicles occupy the same public resource costs - such as roads, parking lots - as everyone else," he said. "In order to rectify the traffic congestion problems, [we can] only raise the restrictions on purchasing vehicles, limiting the number of cars being sold, as well as providing measures to encourage increased public transportation usage."
Zhejiang, which translates as 'crooked river' is an eastern province bordering Shanghai to the north and its major cities include Hangzhou, Haining and Ningbo.