Big news is coming out of China that could shake up global trade. Starting in 2026, the Chinese government will eliminate long-standing export rebates for hundreds of products, affecting a wide spectrum of industries.
This isn’t a minor adjustment. It’s a major policy shift that will influence the cost of exporting goods from industrial materials to everyday consumer products.
In this article, we explain what’s happening, which categories of products are affected, and why importers need to pay attention.
What Is an Export Rebate?
Essentially, an export rebate is a VAT refund that manufacturers pay during production. In China, as in many countries, VAT is applied at various stages of making a product. An export rebate simply means the government returns that tax to the company once the goods are shipped abroad. This helps lower production costs and allows Chinese exporters to offer competitive prices on the global market.
Under the new policy, these rebates will no longer be available for a wide range of products. As a result, exporters’ costs will rise, which could translate into higher prices for buyers worldwide.
Official Announcement
See the official announcement here , opens in a new window.
Here is the translated announcement
Notice No. 2/2026 – Amendments to Export Tax Rebate Policies for Photovoltaic and Battery Products
Issuers: Ministry of Finance and State Tax Administration of China
Publication Date: January 8, 2026.This notice addresses adjustments to export tax rebate policies for photovoltaic and other related products:
I. Cancellation of Export VAT Rebates for Photovoltaic Products
Starting from April 1, 2026, export VAT rebates for photovoltaic and other related products will be cancelled. A detailed list of products is provided in Annex 1.
II. Reduction and Cancellation of Export VAT Rebates for Battery Products
- From April 1, 2026 to December 31, 2026, the export VAT rebate rate will be reduced from 9% to 6%.
- From January 1, 2027, export VAT rebates for battery products will be fully cancelled.
A detailed list of products is provided in Annex 2.
III. Excise Products
For products covered by this notice that are subject to excise tax, the export excise rebate policy will not change. Excise tax rebates (exemptions) remain in effect.
IV. Application of Export Rebate Rates
The export rebate rate applicable to the products listed in this notice is determined according to the export date declared in the customs declaration.
Ministry of Finance and State Tax Administration
January 8, 2026.
Which Products Are Affected?
Although the official announcement highlights photovoltaic products and battery materials, the policy covers a much broader spectrum of goods. The phrase “other products” in the official document encompasses numerous categories, including industrial, chemical, construction, and consumer goods. Many of these are classified by HS codes in Annex 1.
- Chapter 24 – Tobacco and manufactured tobacco substitutes
- Chapter 25 – Salt; sulphur; earths and stone; plastering materials, lime and cement
- Chapter 28 – Inorganic chemicals; compounds of precious metals, rare-earth metals
- Chapter 29 – Organic chemicals
- Chapter 38 – Miscellaneous chemical products
- Chapter 39 – Plastics and articles thereof
- Chapter 68 – Articles of stone, plaster, cement, asbestos, mica
- Chapter 69 – Ceramic products
- Chapter 70 – Glass and glassware
- Chapter 85 – Electrical machinery and equipment
- Chapter 85 – Electrical machinery and equipment, specifically:
- Primary cells and batteries (button, cylindrical, lithium, zinc-air, silver-oxide, fuel cells)
- Mercury content specifications (non-mercury and mercury-containing cells)
- Battery packs and assemblies
- Battery parts and components
- Rechargeable batteries (NiMH, Li-ion, vanadium flow batteries)
Note: The numbers above indicate the main HS codes. For full details, descriptions, and all specific codes, see the official PDF.
Official Resources & Data:
Products affected from April 1, 2026 (Official PDF) , opens in a new window |
Battery products affected from January 1, 2027 (Official PDF) , opens in a new window
Original Source (Ministry of Finance, PRC) (Official Chinese document)
http://szs.mof.gov.cn/zhengcefabu/202601/t20260109_3981637.htm , opens in a new window
Examples of products that will be affected:
- Solar panels and PV modules
- Lithium batteries and battery packs
- Plastic packaging and casings
- Ceramic tiles and sanitary ware
- Glass products (glasses, bottles, industrial glass)
Timeline of the Changes
- April 1, 2026: Export rebates for the wide product list are completely removed. Certain battery product rebates are temporarily reduced from 9% to 6%.
- January 1, 2027: Remaining rebates for battery materials are fully eliminated, aligning with the broader product list.
Why Importers Should Care
This change has real consequences for anyone sourcing products from China:
- Costs may increase: Exporters may raise prices to offset the loss of rebates.
- Supply chains could shift: Buyers may consider alternative suppliers if costs rise significantly.
- Planning is crucial: Companies should evaluate contracts and anticipate potential price impacts.
In short, a key financial incentive for Chinese exports is disappearing, which could affect prices and supply chains globally.
Frequently Asked Questions (FAQ)
- What is being removed?
- The export rebate, a VAT refund for exported goods, is being eliminated for hundreds of products categorized by HS codes in the official annex.
- When does this happen?
- April 1, 2026, marks the start of the main changes. The final phase for battery products takes effect on January 1, 2027.
- Will import prices rise?
- Most likely. Without the rebate, exporters’ costs increase, which may translate into higher prices for buyers.
- Why is China making this change?
- The government cites fiscal and economic reasons, as well as broader strategic priorities for industry and trade.
- What should businesses do now?
- Review supply contracts, estimate cost impacts, and explore alternative sourcing options. Early planning is essential.
Bottom line: Starting in 2026, hundreds of Chinese products will lose a key financial benefit. Importers should prepare now, review costs, and adjust their supply chain strategies before the changes take effect.
Need help?
If you import goods from China and are unsure whether your products are affected by this change, we can check your HS codes, suppliers, and assess the potential impact on pricing. Contact: contact us
