Abstract:

The worldwide shortage of fossil resources and environmental degradation are both becoming worse. Using a difference-in-differences specification to take advantage of exogenous variation from the implementation of the car purchase tax exemption policy, the study empirically assesses the causal relationship between the growth in new energy vehicle sales and the exemption of vehicle purchase tax on such automobiles. This study concludes that the policy increased electric car sales by an average of 177.3% and serves as a catalyst for discussing the importance of regulations and sales.