A cheap Chinese-made car takes up 140 percent of the buyers' annual income, compared with 30 to 40 percent in the United States. Imported cars are beyond the reach of ven the upper middle class. Taxes and tariffs add about 50 percent to the value of Mercedes and BMWs. Hummers cost about $200,000 in China.
China has a rather high car ownership rate, mostly because of the status symbol that comes with vehicles. According to the survey conducted by Rakuten Insight, about 71.4 percent of the Chinese respondents stated they owned a car.
At around $13,700, the average price of an exported China-made passenger vehicle was about one-third that of a German car in 2021, and about 30% less expensive than a Japanese make, according to data provided by UN Comtrade.
Buying a car in China and driving it in China
Is allowed as a foreigner. Buying the car is easy. The problem is the license plate. You need to buy your license plate where you have your residence permit.
The government will cut the tax for cars priced at no more than 300,000 yuan ($45,000) and with 2.0-liter or smaller engines to 5% of the sticker price, down from 10% earlier, it said in a statement. The tax cut will be applicable for purchases from June 1, 2022 through the end of the year.
The Individual Income Tax in China (commonly abbreviated IIT) is administered on a progressive tax system with tax rates from 3 percent to 45 percent.
In 2019, the average price of a second-hand vehicle sold in China was around 62,700 yuan, up from about 62,200 yuan in the previous year.
On top of the lack of automotive history and culture, there's a whole lot of red tape. Chinese government legislation bans used car import, and used cars cannot be registered for road use. The law defines a used car as any vehicle that is not brand new. Therefore, in theory, all collector and classic car are banned.
Number of cars per 100 households in urban and rural China 2019-2020. In 2020, there were around 45 cars per 100 urban households in China. In the same year, this value was approximately 26 cars per 100 rural households.
In 2021, the average price for residential real estate in Shenzhen was over 61.6 thousand yuan per square meter. This was the highest price among all major cities in China, with the average price across the country amounting to 16,533 yuan per square meter.
Maximum and minimum salary range
The average salary in China ranges from 7,410 Yuan per month (USD 1,066) to 131,000 Yuan (USD 18,842) per month — with 7,410 Yuan being the minimum salary and 131,100 Yuan being the maximum salary.
It has the most expensive cars in the world.
In China the very same car goes for 2.88 million yuan, or $440,000, more than double the U.S. price. One more example: the Ferrari 512berlinetta costs $323,745 in the U.S., and 5.3 million yuan in China – that is $810,000, just over 2.5 times more.
Chinese EV makers can produce vehicles for less because they have lower research and development costs, lower levels of capital spending and lower labour costs than rivals in Europe, Mr Koller said.
Why cars are expensive in China? The major driver for high car price is taxation, namely 25% customs duty, 17% VAT and between 1% to 40% consumption tax depending on the displacement capacity of the car. As such, the price for an imported car in China usually consists of more than 50% tax of various kind.
In China, there are currently fewer than 200 vehicles per 1,000 people, compared to about 600 in the European Union and over 800 in the United States (Figure 1).
A general minimum speed limit of 60 km/h (37 mph) is in force at all times (although traffic jams thwart it). On expressways in mainland China, automobiles are generally 100-120 km/h, while buses and trucks are generally limited to 80-100 km/h. Other road conditions are the same as those of automobiles.
In China, the minimum age for automobile driving is 18 years. China had about 418 million registered drivers as of 2020.
However, mainland China drives on the right-hand side of the road while Hong Kong is a left-hand drive city. When a mainland driver crosses into Hong Kong, he is likely to sometimes mistakenly end up on the wrong side of the road, and vice versa.
The cost of living in China can vary by location and type of purchase. On average, China's cost of living is 45% lower than the U.S according to Numbeo. Rent in China is 60% lower than the U.S. on average. But the cost of items like cars and private school tuition are actually very similar.
For example, a Big Mac costs ¥24.40 in China and $5.81 in the United States.
Is living in China safe? Yes, many expats, especially women, find living in China is much safer than in cities like London or New York. Street harassment and catcalling is virtually unheard of for foreigners, and streets tend to be well lit at night.
China has postponed changes to individual income tax (IIT). Foreign residents can now take advantage of the tax benefits until 31 December 2023. Shortly before the turn of the year 2021/2022, the Chinese government announced that it would postpone the changes in individual income tax planned for 1 January 2022.