Aimed at easing the country’s energy dependency, improving air quality and helping its automotive industry to grow, it means all electric, plug-in hybrid and hydrogen fuel cell vehicles will be exempt from the purchase tax until the end of 2017.

China is looking set to become an advanced market for electrically-driven vehicles, with the Beijing government alone aiming for 170,000 within the city by the start of 2018, supported by a network of 10,000 public charging points in car parks, service stations and public transport hubs.

Huge populations and the rapid growth of the automotive industry in China have caused large problems with air quality, with Beijing authorities warning inhabitants not to leave their homes in January 2013. The country also has a growing domestic electric vehicle industry, which would be supported by the tax relief.