China to exempt Tesla cars from purchase tax

China to exempt Tesla cars from purchase tax
# 30 August 2019 19:17 (UTC +04:00)

China will exempt Tesla Inc’s (TSLA.O) electric vehicles (EV) from purchase tax, the Ministry of Industry and Information Technology (MIIT) said on its website, APA reports citing Reuters.

China currently levies a 10% purchase tax on the sale of each vehicle. The move could reduce the cost of buying a Tesla car by up to 99,000 yuan ($13,957.82), according to a post on Tesla’s social media WeChat account.

Tesla’s pre-market share price jumped more than 5% after the announcement.

Sixteen variants - all the Tesla models sold in the country - are listed on the document issued by MIIT, including Model S, X and 3. No reason was given for the decision to exclude the cars from the tax.

The U.S. EV maker is building a plant in Shanghai, the firm’s first overseas factory.

It is due to start production by the end of the year and Tesla has said it should be able to build 3,000 Model 3 vehicles a week in its initial phases.

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