Global VAT & Indirect Tax News

China will abolish VAT export rebates for photovoltaic products from 1 April 2026 and phase out battery rebates by 1 January 2027. The policy aims to curb aggressive price discounting and reduce trade friction risks. Consumption tax rebates for these products will remain unchanged.

China’s Ministry of Finance and State Taxation Administration announced that from 1 April 2026, VAT export rebates for e‑cigarette products will be cancelled. The change also reduces battery product rebate rates and eventually cancels them, requiring exporters to adjust customs declarations accordingly.

China will eliminate VAT export rebates for photovoltaic products from April 1, 2026, and will reduce battery export rebates from 9% to 6% between April 1 and December 31, 2026, before fully phasing them out on January 1, 2027. The policy covers a wide range of solar and battery products, including monocrystalline silicon wafers, lithium‑ion batteries, and all‑vanadium redox flow batteries. This marks a significant shift in China’s export incentive regime, potentially increasing export costs for manufacturers.

KPMG China outlines the key provisions of the newly issued Implementation Regulations of China’s Value‑Added Tax Law, which came into force on 1 January 2026. The regulations refine definitions of taxable transactions, clarify zero‑rate eligibility for cross‑border services and intangible assets, and provide detailed guidance on VAT deduction and exemption criteria. Taxpayers should review the new rules to ensure compliance and optimize VAT management.

Deloitte China outlines the impact of its new VAT law effective 1 Jan 2026, highlighting key changes such as cross‑border supply rules, deemed sales, mixed sales, input‑VAT recovery rights, and mandatory e‑invoicing. The firm advises businesses to evaluate compliance and strategic implications, while noting forthcoming preferential policies and potential registration options for foreign entities.

China’s State Administration of Taxation has rolled out a mandatory marketplace reporting regime that requires digital platforms to submit structured merchant-level data to tax authorities. The new rules, effective from October 2025, have already increased tax visibility and collections by 13% from online sellers and are expected to tighten compliance for e‑commerce operators. The regime aligns China with global standards such as DAC7 and imposes penalties of up to RMB 500,000 for non‑compliance.