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Volvo Cars faces 10% luxury car tax in China

China will slap on a 10% sales tax on luxury cars starting in December, local Chinese media said Thursday citing a notice issued by the State Administration of Taxation.

People in China buying Volvos may therefor have to think twice before investing in the Swedish car model.

The tax on cars – including the Ferrari GTC4Lusso, Bentley Bentayga and Aston Martin DB9 – is a bid to combat conspicuous consumption, promote more efficient vehicles and reducing green house gas emissions, local media said. The State Council has approved the change.

The Swedish car maker was bought by Chinese Geely in 2010. China sales have been a major force in Volvo’s recovery from years of poor performance under Ford, the Financial Times said. Sales have tripled over the past three years, making China Volvo’s largest single-country market.

Volvo sold more than 63,000 cars in China in the first nine months of 2016, up from 57,000 in the same period last year.

It plans to sell 800,000 cars annually by 2020 — a third of those produced in China — with 200,000 for domestic sale and the rest for export.

 

 

 

Last Updated (Thursday, 01 December 2016 02:33)

 

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