China will withdraw export value-added tax (VAT) rebates on selected photovoltaic (PV) products starting April 1, 2026, under a newly released policy jointly issued by the Ministry of Finance (MOF) and the State Taxation Administration (STA).
According to Announcement No. 2 (2026), the revised export tax rebate policy applies to a defined range of PV-related products and battery products, with the applicable treatment determined by the export date shown on the customs declaration.
Key Changes to Export VAT Rebates
Under the updated measures:
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Export VAT rebates for covered photovoltaic products will be fully cancelled from April 1, 2026
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Battery products will see their export VAT rebate rate reduced from 9% to 6% between April 1, 2026 and December 31, 2026
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From January 1, 2027, export VAT rebates for battery products will also be completely cancelled
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For products subject to consumption tax, the existing export consumption tax rebate or exemption policy will remain unchanged
These adjustments mark a significant shift in China’s export tax rebate policy, particularly for manufacturers and traders involved in the photovoltaic supply chain.
Implications for Polyether Polyols and the Polyurethane Industry
The policy update is especially relevant to the polyurethane industry, as certain product categories may include polyether materials commonly traded as polyether polyols, depending on the declared HS code and customs classification.
As export VAT rebates are removed, exporters of polyether polyols and related polyurethane raw materials may experience higher effective export costs after April 1, 2026. This could lead to:
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Revisions in export pricing strategies
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Adjustments in long-term supply contracts
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Changes to shipment timing and delivery planning
Both exporters and overseas buyers are advised to closely review product classifications and assess how the revised China export VAT rebate rules may affect transaction costs.
Market Outlook and Strategic Considerations
Historically, the cancellation of export tax rebates tends to reduce export netbacks and compress margins for in-scope products. As a result, market participants may seek to optimize shipment schedules or renegotiate commercial terms ahead of the policy’s implementation.
With China continuing to refine its export tax framework for photovoltaic products, batteries, and upstream chemical materials, companies operating across the PV, battery, and polyurethane value chains should closely monitor regulatory developments and prepare for potential cost impacts in 2026 and beyond.
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