{"id":60155508,"date":"2026-10-15T09:15:28","date_gmt":"2026-10-15T08:15:28","guid":{"rendered":"https:\/\/dialogue.earth\/?post_type=news_digest&#038;p=60155508"},"modified":"2026-10-15T09:15:34","modified_gmt":"2026-10-15T08:15:34","slug":"china-to-lower-vat-rebate-for-new-energy-vehicle-exports","status":"publish","type":"news_digest","link":"https:\/\/dialogue.earth\/en\/digest\/china-to-lower-vat-rebate-for-new-energy-vehicle-exports\/","title":{"rendered":"China to lower VAT rebate for new energy vehicle exports"},"content":{"rendered":"\n<p class=\"wp-block-paragraph\">China will be reducing the VAT rebate for new energy vehicle exports from April 2027, from 13% to 9%.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">The reduction affects all types of new energy vehicles, including commercial electric vehicles and plug-in hybrid passenger vehicles, according to a 12 October&nbsp;<a href=\"https:\/\/szs.mof.gov.cn\/zhengcefabu\/202610\/t20261012_4002592.htm\">announcement<\/a>&nbsp;from the Ministry of Finance and the State Taxation Administration.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Lowering the rebate rate serves several purposes, Cui Dongshu, head of the Passenger Car branch of the China Automobile Dealers\u2019 Association, told&nbsp;<a href=\"https:\/\/www.yicai.com\/news\/103390723.html\">Yicai<\/a>. One is to curb involution \u2013 vicious competitive practices among automakers, such as exporting at very low prices and even at a loss. High rebates have allowed them to offset losses overseas by selling below cost through tax refunds, and Cui said this could trigger anti-subsidy investigations abroad. The other is to proactively manage trade friction risks and encourage the industry to move from competing solely on price to focusing on product quality.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">The announcement comes just days after the conclusion of China-European Union trade negotiations. Both sides reached a consensus on \u201cmoderately adjusting\u201d Chinese exports of hybrid and plug-in hybrid electric vehicles to the bloc, according to the <a href=\"http:\/\/www.ccceu.eu\/2026-10\/10\/c_5147.htm\">China Chamber of Commerce to the EU<\/a>.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">The EU imported about 300,000 hybrid vehicles from China in 2025. According to&nbsp;<a href=\"http:\/\/www.ce.cn\/xwzx\/gnsz\/gdxw\/202610\/t20261014_3257515.shtml\">CCTV<\/a>, the two sides negotiated a fixed annual increase based on the figure, ensuring stable growth of Chinese automobile exports to the EU.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">The rate reduction is expected to have a less than 2% impact on the gross profit margin of exported models. This means it will have a relatively limited impact on mid- to high-end models, but puts greater pressure on low-end, high-volume models as they already operate on thin margins, according to the&nbsp;<a href=\"https:\/\/m.21jingji.com\/article\/20261014\/769877d95dcda6ba1ae00715fd3f7705.html\">21st Century Business Herald<\/a>.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">The reduction follows the VAT export rebate cancellation for solar products <a href=\"https:\/\/fgk.chinatax.gov.cn\/zcfgk\/c102416\/c5246745\/content.html\">effective<\/a>&nbsp;April 2026. The same rebate for battery products, meanwhile, was reduced from 9% to 6% in April, and will be cancelled starting January 2027.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Yang Weibin, an expert in new energy vehicles and power batteries, told the\u00a0<a href=\"http:\/\/www.ce.cn\/macro\/more\/202610\/t20261013_3255868.shtml\">Daily Economic News<\/a>\u00a0that as the scale of exports of such vehicles continues to increase, their VAT export rebate will be gradually reduced until it is eventually completely eliminated.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\"><em>Read Dialogue Earth\u2019s previous <a href=\"https:\/\/dialogue.earth\/en\/digest\/china-ends-tax-rebates-for-solar-exports\/\"><em>report<\/em><\/a>&nbsp;on China&#8217;s cancellation of export tax rebates for solar products.<\/em><\/p>\n\n\n\n<p class=\"wp-block-paragraph\"><\/p>\n","protected":false},"excerpt":{"rendered":"<p>It will be reduced from April 2027, from 13% to 9%, according to a 12 October government announcement<\/p>\n","protected":false},"featured_media":60006649,"template":"","meta":{"_acf_changed":false,"_has_post_settings":[],"footnotes":""},"categories":[758],"tags":[13444,569,580],"country":[20000110],"digest-collection":[50039911],"class_list":["post-60155508","news_digest","type-news_digest","status-publish","has-post-thumbnail","hentry","category-business","tag-electric-vehicles","tag-negotiations","tag-policy","country-china"],"acf":[],"yoast_head":"<!-- This site is optimized with the Yoast SEO Premium plugin v26.0 (Yoast SEO v26.0) - https:\/\/yoast.com\/wordpress\/plugins\/seo\/ -->\n<title>China to lower VAT rebate for new energy vehicle exports | Dialogue Earth<\/title>\n<meta name=\"description\" content=\"It will be reduced from April 2027, from 13% to 9%, according to a 12 October government announcement\" \/>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" 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