China Cancels Export VAT Rebates on 271 Products from April 2026

249 Products Lose Rebates Overnight, 22 Battery Items Phased Out — the Export Window Is Closing Fast

1. Key Policy Points at a Glance

This adjustment involves two timelines and two treatment methods. Exporters must clearly distinguish between them:

Adjustment Type	Products	Effective Date	Change
Full cancellation	249 items	April 1, 2026	Rebate rate drops to 0%
Phased reduction (batteries)	22 items	Apr 1, 2026: cut to 6% Jan 1, 2027: cancelled	9% → 6% → 0%

2. The 249 Products Losing Rebates — Category Breakdown

The 249 cancelled items span an exceptionally wide range. Below is a category-by-category summary to help businesses quickly determine whether they are affected.

2.1 Chemicals & Organic Compounds (~90 items)

The largest category in this round. Includes bulk chemicals such as methanol (29051100), ethylene glycol (29053100), 1,4-butanediol (2905399002), and trichloroethylene (29032200), along with numerous organophosphorus compounds, phosphate ester derivatives, and pesticide intermediates.

Notably, several lithium battery cathode precursors are included: lithium hexafluorophosphate (28269020), lithium manganate (28416910), lithium cobalt oxide (2841900010), lithium nickel cobalt manganese oxide (28429030), lithium nickel cobalt aluminum oxide (28429060), and their hydroxide intermediates. These are critical raw materials for power and energy storage batteries, and the rebate cancellation will directly raise export costs across the entire lithium battery supply chain.

2.2 Plastics & Polymers (~7 items)

Covers PVC (39041090, 39042100, 39042200), polyether (39072990), and polysiloxane (silicone) (39100000) in primary forms. PVC is one of China's highest-volume chemical exports; losing rebates will significantly impact price competitiveness in Southeast Asian and African markets.

2.3 Stone & Slate Products (~13 items)

Includes processed marble, travertine, granite, and limestone products and stone carvings (68022120–68030090) — traditional Chinese export strengths. Decorative stone, memorial headstones, and building slabs all lose their rebates.

2.4 Abrasives & Grinding Products (~12 items)

Covers grinding wheels, millstones, sandpaper, and abrasive cloth (68041000–68053000). These are low-value-added but steady-volume exports; the cancellation hits small and medium abrasive manufacturers hardest.

2.5 Building Materials & Insulation (~30 items)

Spans a wide range: mineral/rock wool (68061090), gypsum boards (68091100–68099000), cement bricks and precast components (68101100–68109990), asbestos and non-asbestos fiber-cement panels (68114010–68118990), and carbon fiber fabrics and prepregs (68151200–68151390).

The removal of rebates on carbon fiber products and aluminum silicate fiber — high-end building materials — deserves particular attention from companies exporting to European and American construction markets.

2.6 Ceramics (~36 items)

One of the most broadly impacted categories. Includes:

• Building ceramics: ceramic tiles, floor tiles, mosaics (69072110–69074090) — China is the world's largest ceramic tile exporter; the rebate cancellation will significantly affect major production hubs such as Foshan, Chaozhou, and Zibo
• Sanitary ceramics: porcelain/ceramic basins, bathtubs, toilets (69101000, 69109000)
• Tableware: bone china, porcelain kitchenware, ceramic tableware (69111011–69120090)
• Decorative & industrial ceramics: figurines, ornamental items, and other ceramic articles (69131000–69149000)
• Technical ceramics: refractory ceramics, laboratory ceramics (69039000–69091900)

2.7 Glass & Glass Products (~50 items)

Covers virtually the entire glass value chain from raw materials to finished goods:

• Raw materials & semi-finished: cullet, glass blocks, unworked glass tubes (70010010–70023900)
• Flat glass: LCD/OLED substrate glass (7003190001, 7005290002)
• Safety glass: toughened and laminated safety glass (70071110–70072900)
• Insulating glass: hollow/vacuum insulating units (70080010–70080090)
• Mirrors: vehicle rearview and other framed/unframed mirrors (70091000–70099200)
• Glass containers: ampoules, bottles, jars, stoppers (70101000–70109090)
• Glassware: stemware, tableware, lead crystal (70131000–70139900)
• Optical & laboratory glass: lens blanks, lab glassware (70140010–70179000)
• Glass fiber: mats and other glass fiber products (70198010, 70199099)
• Other: conductive glass, vacuum flask inners (70200011–70200091)

2.8 Solar Cells (2 items)

Both unassembled photovoltaic cells (85414200) and assembled solar modules (85414300) are on the list. Given the massive scale of China's solar exports, this cancellation will have a direct and far-reaching impact on the photovoltaic industry's export margins.

2.9 E-cigarettes & Nicotine Products (2 items)

Non-combustion nicotine inhalation products (2404120000) and other e-cigarettes/personal vaporizers (8543400090) lose their rebates, continuing the regulatory tightening trend on the e-cigarette sector.

3. 22 Battery Products: Phased Rebate Elimination

Unlike the 249 items above, battery products follow a gradual phase-out with a built-in buffer period:

• Phase 1 (from April 1, 2026): rebate rate cut from 9% to 6%
• Phase 2 (from January 1, 2027): rebate rate drops to zero — fully cancelled

The 22 battery items include:

• Primary batteries: alkaline manganese (button, cylindrical), silver oxide, lithium primary cells, zinc-air, fuel cells, and their parts (HS 8506 series)
• Rechargeable batteries: nickel-metal hydride (85075000), lithium-ion batteries (85076000), vanadium redox flow batteries (85078030), other accumulators (85078090), and parts (85079090)

Lithium-ion batteries (85076000) stand out as one of the world's highest-volume single export items. China commands over 60% of the global market for power and energy storage batteries. The phased reduction from 9% to zero will have major cost implications for battery exporters, EV manufacturers (whose vehicles contain battery packs), and energy storage system exporters alike.

4. Impact Analysis for Exporters

Losing the rebate means exporters must absorb the VAT that was previously refunded. Key impacts include:

• Direct cost increase: For products previously enjoying a 13% rebate, every CNY 1 million in export value now costs roughly CNY 130,000 more. Thin-margin categories like ceramic tiles, PVC, and glass containers face the greatest squeeze
• Pricing overhaul required: Companies with existing long-term contracts that did not build in rebate-fluctuation buffers may see short-term losses
• Supply chain restructuring may accelerate: Lower-value-added products may lose export competitiveness, potentially driving production shifts to Southeast Asia or the Middle East. Higher-value players will need to offset costs through technology upgrades or brand premiums
• Pre-April shipping rush expected: Between now and late March, a surge in shipments for affected categories is likely, potentially driving up short-term freight rates and tightening container availability

5. Practical Recommendations for Exporters

With the policy window closing rapidly, exporters should take the following steps:

• Audit open orders immediately: Cross-check every active contract's HS codes against the cancellation list. For orders that can be shipped before April 1, expedite production, booking, and customs clearance
• Recalculate export pricing: For deliveries after April 1, re-quote FOB/CIF prices assuming zero rebate and proactively communicate price adjustments with buyers
• Plan for the battery phase-out: Battery exporters need a two-phase costing model — 6% rebate from April to December 2026, then zero from 2027
• Secure shipping space early: A March shipping rush is virtually certain. Lock in container bookings with your freight forwarder well in advance to avoid missing the deadline due to capacity constraints
• Optimize product mix long-term: Consider shifting toward higher-value products, expanding domestic sales channels, or exploring overseas production to offset rising export costs

6. How Mighty International Can Help

With 25 years of international logistics expertise, Qingdao Mighty International offers:

• Urgent ocean/air/rail booking services to secure the pre-April shipping window
• One-stop customs declaration and inspection, ensuring compliant rebate filing
• Specialized packing and transport solutions for chemicals, solar modules, ceramics, glass, and other sensitive cargo
• Freight rate comparisons and optimal routing across major global trade lanes

The policy window is limited — every day earlier you ship translates into real cost savings. For urgent bookings or customs assistance, please contact Mighty International. We are here to help.