China Adopts Unified VAT Law Effective January 2026, Aims to Consolidate Tax Regulations

• China has adopted a law for a unified VAT set to start on January 1, 2026
• The law aims to consolidate all previous VAT regulations and exemptions into a single framework
• VAT is a major revenue source for China, contributing about 38 percent of the tax income in 2023
• The new VAT law will include some exceptions, specifics of which are currently unclear
• Previous drafts of the law allowed exemptions for certain agricultural products and imported goods for specific uses
• Recent tax incentives were introduced for property and land transactions to boost the real estate market
• VAT revenue declined by 4.7 percent in the January to November period due to reduced domestic demand
• A slight increase in VAT revenue before November indicates an improving economic situation with rising sales and business activity

Source: bta.bg

Note that this post was (partially) written with the help of AI. It is always useful to review the original source material, and where needed to obtain (local) advice from a specialist.

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