BEIJING, Jan. 10 -- China's passenger vehicle market expanded in December 2022 with an increase in retail sales, industrial data showed Tuesday.

Nearly 2.17 million passenger cars were sold via retail channels in December 2022, up 3 percent year on year, according to the China Passenger Car Association.

From January to December, 20.54 million passenger cars were sold, up 1.9 percent year on year.

A car-purchase tax cut policy has massively contributed to vehicle sales since its launch in June, said the association.

The policy slashed the purchase tax in half for passenger cars under 300,000 yuan (about 43,103 U.S. dollars) with engine displacement below 2 liters purchased between June 1 and Dec. 31, 2022.

The tax, usually 10 percent of a vehicle's sticker price, has now been cut to 5 percent.