The Chinese government has broken up six gangs responsible for smuggling around $164 million worth of cars into China over the past three years. The smuggled vehicles included over 80 high-end models like BMWs and Rolls-Royces, according to a report by official Xinhua news agency. The gangs smuggled a total of more than 3,000 vehicles. Vehicle smuggling has been rampant in China as consumers try to avoid paying high taxes imposed on high-end foreign models.
Authorities imposed 25-percent tariffs on foreign cars imported to China for any type. China also imposes a 17-percent value-added tax as well as consumption tax, depending on engine size. For instance, a new fully equipped, V-8-powered Maserati Quattroporte carries a starting price of around EUR325,000 after added taxes.
In Europe, the same vehicle would have a starting price of EUR150,000. The authorities so far have arrested 54 gang members responsible for smuggling vehicles from the United States, Vietnam, Myanmar and Hong Kong, according to Xinhua. In July this year, Xinhua accused foreign carmakers of gaining very high profits by selling imported luxury cars in China. It even called for them to face an anti-trust probe.