China cuts EV export VAT rebate from 13% to 9% from April 2027

China will cut the value-added tax it refunds on exported new energy vehicles from 13% to 9% from April 1, 2027. Announcement No. 29 of 2026, issued October 12 by the Ministry of Finance and the State Taxation Administration, sets the applicable rate by the export date shown on the customs declaration. The notice gives no reason for the change.

Buses, trucks and plug-in hybrids are caught along with electric cars. Annex 1 names 67 tariff lines: passenger vehicles driven only by an electric motor; plug-in hybrids with petrol or diesel engines in every displacement class, which make up 56 of the lines; electric-only buses with 10 or more seats; electric-only semi-trailer road tractors and other electric-only goods vehicles; off-road dump trucks with electric-wheel drive; and electric short-distance tow tractors and freight carts without lifting or handling equipment, the kind that work railway platforms, factories, warehouses, docks and airports.

The 4-percentage-point cut lands on the part of the business that is growing. China's NEV exports rose 130% year on year to 4.006 million vehicles in the first nine months of 2026, CnEVPost reports, citing the China Association of Automobile Manufacturers. Deutsche Bank estimates the change will reduce BYD's net profit by about 5,000 yuan ($743) per exported vehicle, starting in the second quarter of 2027, per the outlet.

The cut extends a run of rebate cuts on clean-energy exports. China eliminated export VAT rebates for solar photovoltaic products on April 1, 2026, and lowered the battery rate from 9% to 6%, with battery rebates scheduled to end on January 1, 2027, CnEVPost notes. At home, lithium-ion batteries began paying a 2% consumption tax on September 1, 2026 (China starts taxing lithium-ion batteries at 2%, solar cells next).

The cars share the notice with humbler goods. From the same date, the announcement scraps the export rebate outright for e-cigarette devices, nicotine products and a list of bamboo goods running from flooring and plywood to disposable chopsticks. Products in either list that pay consumption tax keep their existing consumption-tax refund or exemption on export.