EconDaddy IB Economics tutor - tax cuts for cars in China

Wall Street Journal: China Car Sales Rise Sharply in September

Article published: Oct 12, 2016 – out of date: no longer suitable for your IB Economics commentary

IB Economics syllabus: Microeconomics (government intervention: tax cut)

Thanks to tax cuts, Chinese car manufacturers can sell their products at lower prices. No wonder that there are a lot more sales since the introduction of the new tax policy. Moreover, this lower tax rate will only last until the end of this year, therefore – because of the expectations of higher prices in the future – demand has grown even more for new cars.

Source of image: IMAGINECHINA/ZUMA PRESS

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