At a press conference held on Tuesday, Li Xianzhong, Director of the Comprehensive Department of the Ministry of Finance, announced that the Ministry of Finance and the State Administration of Taxation have released a notice regarding the adjustment of export tax rebates for photovoltaic (PV) products. Starting from April 1, 2026, the export tax rebate for PV and other products will be canceled, with a gradual phasing out of export tax rebates for electronic products over the next two years. This policy adjustment aims to promote the efficient use of resources, guide reasonable industrial structure adjustments, and comprehensively address the chaotic competition often referred to as “involution,” thereby fostering high-quality economic growth.
On the evening of January 9, the Ministry of Finance’s official website published the notice detailing these changes. According to the announcement, from April 1, 2026, the value-added tax (VAT) export rebate for PV products will be eliminated. Additionally, from April 1, 2026 to December 31, 2026, the VAT export rebate rate for battery products will be reduced from 9% to 6%, and starting on January 1, 2027, the rebate for battery products will also be completely removed.
The export tax rebate policy for the PV industry was initiated in 2013, allowing companies to enjoy a rebate of up to 50% on VAT. As the industry developed, the rebate rate was gradually decreased. In November 2024, the Ministry of Finance and the State Administration of Taxation announced a reduction of the export rebate rate for PV products from 13% to 9%. The latest adjustment marks the first complete cancellation of VAT export rebates for related products since the PV industry was included in the export tax rebate policy system.
On January 8, the China Photovoltaic Industry Association stated that timely reductions or cancellations of export tax rebates for PV products could help stabilize foreign market prices, mitigate trade friction risks, and effectively alleviate the financial burden on the state, allowing for a more rational and efficient allocation of fiscal resources.
The association pointed out that the export tax rebate policy effectively served as a subsidy for overseas end markets, leading to profit losses for domestic companies and significantly increasing the risk of international trade disputes, such as anti-subsidy and anti-dumping measures against China’s PV industry. This has negatively impacted both the overall interests of the Chinese PV sector and its international image.
In a research report, CITIC Securities indicated that in the short term, PV and energy storage companies may face increased export costs and pressure on profitability. It is expected that during the transition period, the shipment volume of PV modules will increase rapidly, but after the rebate policy is implemented, exports of PV modules could decline by 5% to 10%.
However, the report suggests that in the long run, the chaotic “involution” situation caused by previous low-price competition in the PV industry may ease, with technological innovation and brand development likely becoming the main focus, accelerating the elimination of outdated production capacities.
Original article by NenPower, If reposted, please credit the source: https://nenpower.com/blog/finance-ministry-responds-to-cancellation-of-export-tax-rebates-for-photovoltaic-products-a-step-towards-addressing-disorderly-competition/
