Recently, the Ministry of Finance and State Administration of Taxation issued the "Ministry of Finance State Administration of Taxation on the adjustment of consumption tax policy notice" from December 1 this year, canceled a cylinder capacity of 250 ml (excluding) the following small-displacement motorcycle consumption tax. But cylinder capacity of 250 ml and 250 ml (not included) respectively over the motorcycle continued rate of 3% and 10% of the consumption tax.
Get this news, many industry stakeholders and consumer can not help shouted "fair." As we all know, our national consumption tax levied on luxury goods, and some more alcohol, firecrackers, refined oil limiting consumer goods. And China’s motorcycle major user groups are farmers, according to the China Association of Automobile Manufacturers statistics, in 2013 China’s motorcycle sales of about 23 million, of which more than 90% belong to 250 ml or less, which are mostly sold in rural areas. Although the consumption tax levied in the production, but will eventually be passed on to consumers. For low-income groups of farmers and then excise duties does not seem fair. Under the previous policy, per 250 ml or less displacement motorcycles will be required to pay the prices of a 3% consumption tax. In a 150 ml displacement motorcycle unit price of 8,000 yuan, and now consumers can enjoy 240 yuan car tax breaks.
The small displacement motorcycle consumption tax is also hard-earned canceled. According to my understanding, many NPC deputies and CPPCC members on several occasions in the two sessions on the proposed abolition motorcycle consumption tax; the Automobile Association motorcycle club from 2008 to repeatedly reflected motorcycle excessive consumption tax issue to the relevant part of the government. Motorcycle Branch Secretary Li Bin, who on many occasions mentioned that "the motorcycle industry is facing the transformation and upgrading, the industry is facing difficulties. And now for the domestic consumption tax on motorcycles or 20 years ago and 20 years ago, Motorcycle also is a luxury and now farmers are standard equipment. The current of less than 1.0 liters of displacement car consumption tax rate of 1%, however, while the motorcycle consumption tax for different displacement 3% and 10%, which is obviously not Fair."
Cancellation small displacement motorcycle consumption tax, the domestic motorcycle market is expected to play a stimulating role. Many motorcycle manufacturers are beginning to prepare the New Year combined with consumer tax cancel and return to carry out a series of promotional activities, final consumption tax will be canceled by way of lower product prices to consumers so that degree.
It is worth pondering by way of price reduction will allow the degree of benefit to the consumer is indeed the most direct benefits to consumers. But I prefer to see is companies can benefit from research and development funds for technological transformation, the introduction of more high-quality products to consumers, so "none" may be more loved by consumers in the long run.
China’s motorcycle industry "big but not strong," the problem has been longstanding, industry production and sales for 20 consecutive years ranked first in the world, but mainly in the low-end products, the industry profit margin of less than 3%. Total profits of the whole industry is less than a US company Harley. Currently, the motorcycle industry is at a critical moment of transformation and upgrading of traditional consumer market motorcycles slowly changing, gradually increase farmers’ income, the demand for motorcycles is not limited durability, fuel economy, cargo capacity, motorcycles performance, appearance also have higher requirements. Meanwhile, China’s large displacement motorcycle market is also developing rapidly, it is expected this year, more than 400 ml of production close to large displacement motorcycles million, growth of 80%. Imports large displacement motorcycles are expected to more than 10,000 this year, the growth rate of 120%. China’s large-displacement motorcycle manufacturing experience and technology still relatively weak, if not to increase investment in this area, it is likely in the future domestic large displacement motorcycle market is completely dominated by foreign brands. So, this is the need for companies to get more profit after tax, with the development of new products and technologies, accelerate the transformation of product structure, to produce more in line with consumer demand.
