According to a document released by China's key economic planning body, the National Development and Reform Commission (NDRC), manufacturers of low-emission, energy efficient cars will enjoy preferential tax benefits, the Beijing Daily said.

"The NDRC and other relevant authorities are currently looking into policy measures to encourage and support the development of the consumption (of these cars)," the report quoted Liu Zhi, a senior NDRC official, as saying.

Some 80 Chinese cities, including Beijing, currently impose road restrictions on small cars, banning them from entering main roads and motorways in many places.

The NDRC is looking into scrapping these restrictions across China, the report quoted Liu as saying.

The number of privately-owned cars in China is expected to reach 17 million by the end of this year, up nearly three times from 6.25 million in 2000, according to official data quoted by Xinhua news agency.

Due to soaring international oil prices, China has seen its refined oil price rise five times in 2005, Xinhua said.

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