(Yicai Global) April 3 -- BYD, an electric vehicle manufacturer, proposes that China will extend its purchase tax exemption for new energy vehicles till 2025 to support the capital-intensive industry.

Wang Chuanfu, founder and chairman of the major marque, suggested the policy should be prolonged for two years after the current deadline of December during the China EV100 Forum 2023 held recently.

The country has been exempting NEV buyers from the standard 10-percent tax levied on the selling price of vehicles since 2014 to boost the transition into greener transport. Car buyers saved CNY87.9 billion (USD12.8 billion) last year due to the policy, and such savings almost doubled from 2021.

The development cycle of NEVs is relatively long so product development and design, as well as cost management, require long-term arrangements, per Wang. This year, the NEV industry is facing the crucial stage of turning quantitative change into qualitative change, he added.

Stefan Mecha, chief executive of Volkswagen Passenger Cars in China, was also calling for an extension of the same policy at the event to create stable policy frameworks. For Volkswagen and even the entire automotive sector in China, added policy support will improve growth, Mecha added.

Editor: Shi Yi, Emmi Laine, Xiao Yi