{"id":60143401,"date":"2026-07-23T12:44:05","date_gmt":"2026-07-23T11:44:05","guid":{"rendered":"https:\/\/dialogue.earth\/?post_type=news_digest&p=60143401"},"modified":"2026-07-23T12:44:10","modified_gmt":"2026-07-23T11:44:10","slug":"china-to-resume-taxing-lithium-batteries-and-solar-cells","status":"publish","type":"news_digest","link":"https:\/\/dialogue.earth\/en\/digest\/china-to-resume-taxing-lithium-batteries-and-solar-cells\/","title":{"rendered":"China to resume taxing lithium batteries and solar cells"},"content":{"rendered":"\n

China will end its 11-year exemption of lithium-ion batteries and most photovoltaic (PV) cells from consumption tax, the government has announced<\/a>. <\/p>\n\n\n\n

China\u2019s consumption tax applies only to certain luxury, high-end or environmentally unfriendly goods like cigarettes, alcohol, jewellery and cars.<\/p>\n\n\n\n

Lithium-ion batteries will be charged a 2% rate from September, rising to 4% from next September. Regular PV cells will be given a buffer period, with 2% starting next April moving to 4% from April 2028.  <\/p>\n\n\n\n

From this September to the end of 2028, the tax will not apply to sodium-ion batteries, solid-state batteries, fuel cells or certain advanced PV cells. <\/p>\n\n\n\n

The new policy comes at a time of rapid growth in the battery industry. Reports show<\/a> that many companies have recently turned their losses into profits. The policy is a bid to contain the unchecked expansion and ensure a \u201chealthy development\u201d for the sector, Li Xuhong, vice president of the Beijing National Accounting Institute, told<\/a> Xinhua. <\/p>\n\n\n\n

Meanwhile, the slight delay for taxation on regular PV cells is likely due to the relatively tough situation in the solar cell industry, especially given the recent cancelling<\/a> of the export tax rebates from this April, industry expert Lv Jinbiao told<\/a> Shanghai Securities Journal. <\/p>\n\n\n\n

Industry insiders say<\/a> the continued exemption for sodium-ion and solid-state batteries, plus advanced PV cells, is designed to support these emerging technologies, according to Beijing News.  <\/p>\n\n\n\n

Some predict<\/a> that the returning taxation will mean a potential price increase for an electric vehicle (EV) of between USD 38 and USD 355. However, Li Yanwei, an automobile expert, suggests<\/a> to Chengdu Business Paper that it will be EV and battery companies, not consumers, who will bear the additional cost.  <\/p>\n\n\n\n

Cui Dongshu, secretary-general of the China Passenger Car Association, told<\/a> the outlet that the policy update will encourage carmakers to produce batteries by themselves instead of buying in batteries.  <\/p>\n\n\n\n

China\u2019s EV exports grew 75.1% year on year in the first half of 2026, reports<\/a> Caixin. Overall exports of the \u201cnew three\u201d products \u2013 EVs, solar cells, and lithium-ion batteries \u2013 rose 51.6% year on year, according to customs statistics.  <\/p>\n\n\n\n

Read Dialogue Earth\u2019s previous <\/em>report<\/em><\/a> on China\u2019s solar villages.<\/em><\/p>\n","protected":false},"excerpt":{"rendered":"

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