- China has issued new VAT guidance on non-creditable input VAT for non-taxable transactions, providing clearer rules for determining when input VAT cannot be deducted. 1
- Two specific lists are used to clarify the input-VAT deduction logic, giving businesses a more structured basis for assessing the VAT treatment of relevant transactions. 1
- Practical impact: businesses should revisit VAT mapping and input-tax controls to ensure transactions are classified correctly under the new guidance; PwC identifies this as the subject of China Tax/Business News Flash, Issue 10, published in September 2026. 1
Source PwC
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