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Japan to Provide Tax Breaks for Hybrid, Electric Cars

Nikkei. Under provisions of a fiscal 2009 tax reform bill, Japan will waive an automobile weight tax for people buying hybrid cars and electric vehicles.

Normally, people purchasing new cars pay the automobile acquisition tax, which is equivalent to roughly 5% of the car’s price, and three years’ worth of the weight tax. This means a person buying a 2 million yen [US$21,700] car that weighs 1.3 tons has to pay a total of 146,700 yen [US$1,600] in taxes.

If the car is a hybrid or an electric vehicle, the taxes will be waived completely starting in April if the bill takes effect as planned. Other types of environmentally friendly cars will also receive 50-75% tax reductions depending on their fuel economies and exhaust emissions.

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