China will extend the purchase tax exemption for new energy vehicles (NEVs) to the end of 2023 in a bid to support the auto sector and boost sales, according to a joint statement from the country's finance, taxation and industries ministries.

It is the third time that China has extended the purchase tax exemption after it was introduced in 2014, extending the policy by three years in 2017 and by two in 2020.

China's NEV industry has benefited from the country's twin 'green goals' of peaking carbon dioxide emissions by 2030 and achieving carbon neutrality by 2060.

NEVs include battery, hybrid and fuel-cell vehicles. The number of NEVs registered in China hit 10.99 million by end-August, accounting for around half of the world's total, data showed this month.

In 2021, sales of NEVs in the world's largest auto market surged 160 percent year on year to 3.52 million units, official data showed. The sector maintained rapid growth momentum this year with 666,000 NEVs sold in August, doubling from the same month last year. 

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