China’s super rich hurry to buy ‘super cars’ before new 10% tax takes effect

The Chinese government has announced yet another tax on luxury goods. A new 10% tariff was added to the price of any super car or luxury model sold after the clock struck midnight on Wednesday. The move by China’s Ministry of Finance is designed to “guide reasonable consumption,” leading many luxury car dealers to encourage extremely unreasonable consumption before it came into effect.
This new burden on China’s super rich will be added to any cars costing 1.3 million yuan ($188,852) and above. Along with promoting rationality, the rule is also targeted at reducing harmful emissions and curbing lavish displays of wealth — something that we all know is close to Chinese President Xi Jinping’s heart.
After the news broke, luxury car dealers around the country began urging consumers to hurry up and buy before the clock struck midnight. Using this tactic, some distributors sold as many cars in a day as they usually do in three full months, Bloomberg reports.
The Ferrari GTC4Lusso, Bentley Bentayga, Aston Martin DB9 are among the cars that will inevitably be affected by this new levy; BMW and Audi have also told Reuters that some of the cars they sell qualify for the price hike as well. So far, it doesn’t seem as though companies are freaking out over this new tax — because, let’s be honest, nothing can do much to stop China’s absurd thirst for luxury goods.

Many foreign manufacturers have been developing vehicles to more closely suit the needs of the rapidly growing Chinese auto market. Both Rolls Royce and Aston Martin are planning SUV models to appeal to Chinese consumers’ preference for larger-model sports cars. For them, this tax will likely be a mere speed bump.
Reducing emissions is a key issue for Beijing — as they attempt to prove to Donald Trump that they did not invent global warming. Recently, there has been considerable investment in electric car innovators like Tesla; however, there are still over 172 million petrol or diesel car owners in China. Ultimately, it’s likely that Beijing’s crackdowns on outdoor barbecues will do more to help the environment than this tax, though perhaps it may inspire some potential luxury car owners to take the subway instead.
It appears as though the new tariff is another way for Xi to crack the whip against the blatantly extravagant spending that was in vogue with corrupt officials before he came to power. Such ostentatious consumption has been a big catalyst for social tensions in China as the wealth gap continues to widen.
But just one question, where does the LaFerrari Aperta with its hybrid engine stand? We need a new company car.
By Seamus Gibson