The new tax policy for 2026 at a glance, these changes are closely related to you
Published: 2026-01-04
Starting from January 1, 2026, a number of new tax regulations will be formally implemented in China, covering a variety of taxes such as value-added tax, land value-added tax, enterprise income tax, vehicle purchase tax, etc., as well as tax registration, tax-related service credit management, export tax rebate networking and other aspects of levy and management. These changes will have an important impact on enterprises and individuals, so let's take a look at the key points together.
VAT legislation on the ground
The Value Added Tax Law of the People's Republic of China has been in force sinceJanuary 1, 2026The Interim Regulations of the People's Republic of China on Value-Added Tax (VAT) came into effect at the same time. The Provisional Regulations of the People's Republic of China on Value-Added Tax shall at the same timerepeal (a law)The
VAT policy for individual sales of housing clarified
The Announcement of the Ministry of Finance and the General Administration of Taxation on the VAT Policy on the Sale of Housing by Individuals (No. 17 of 2025) clarifies that:
Individuals (excluding general taxpayers in self-employed businesses) selling purchases of less than2 yearsof housing at the rate of3%VAT is paid at the levy rate.
Sale of housing purchased more than 2 years ago (including 2 years).VAT exemptionThe
VAT on the sale of housing not declared as paid before January 1, 2026, may be applied in accordance with the new regulations if they are in line with the new regulations.
General taxpayer registration management update
The Announcement of the State Administration of Taxation on Matters Relating to the Registration and Management of General Taxpayers for Value-added Tax (No. 2 of 2026) is clear:
Those whose annual taxable sales exceed the standard for small-scale taxpayers shall, unless otherwise provided, register as general taxpayers.
The Announcement of the State Administration of Taxation on Several Matters Concerning the Registration and Management of General Taxpayers for Value-added Tax (No. 6 of 2018) and the Measures for the Administration of the Tax Counseling Period for General Taxpayers for Value-added Tax (Guoshuifa [2010] No. 40) are repealed at the same time.
Land value-added tax levy caliber refinement
The Announcement of the State Administration of Taxation on Certain Calibers of Levy and Management of Land Value-added Tax (No. 3 of 2026) clarifies the practical rules such as the time for filing pre-collection declarations, the cut-off point for clearing income, the deductibility of eligible expenditures outside the scope of planning, and the deductibility of stamp duty and local education surcharges.
Applies to projects after January 1, 2026 for which a Notice of Liquidation Acceptance has not yet been issued.
New rules for credit evaluation of tax-related professional services
The Announcement of the State Administration of Taxation on the Publication of the Measures for the Administration of Credit Evaluation of Tax-Related Professional Services (No. 1 of 2026) was issued, covering the whole process of management of credit points, grade evaluation, application of results and credit repair.
The new regulations are effective January 1, 2026. For organizations previously included in the evaluation, credit scores for FY 2025 will be implemented according to the old regulations, and credit ratings will be implemented according to the new regulations.
Continuation of pre-tax deduction policy for advertising and business promotion expenses
The Announcement of the Ministry of Finance and the General Administration of Taxation on Matters Relating to Pre-tax Deduction of Expenditures on Advertising Fees and Business Propaganda Fees (No. 16 of 2025) clarifies that:
Enterprises in the manufacture or sale of cosmetics, pharmaceutical manufacturing and beverage manufacturing (excluding alcohol manufacturing) are allowed to deduct the portion of their advertising and business promotion expenses not exceeding 30% of sales revenue for the year; any portion exceeding that amount is allowed to be carried forward for deduction in subsequent years.
Affiliates may enter into sharing agreements to pool expenses for deduction.
No deduction is allowed for tobacco advertising and business promotion expenses incurred by a tobacco company.
Implementation period: January 1, 2026 to December 31, 2027
Income tax treatment of conversion of insurance contracts
The Announcement of the Ministry of Finance and the State Administration of Taxation on Matters Concerning Enterprise Income Tax Treatment in Relation to the Conversion of Standards for Insurance Contracts (No. 15 of 2025) clarifies the enterprise income tax treatment matters involved in the implementation by enterprises of the new standard for insurance contracts (Caixin [2020] No. 25).
The new regulations are effective from January 1, 2026, and the original related reserve deduction regulations (Cai Shui [2016] No. 114) have been discontinued accordingly.
New Energy Vehicles and Energy Efficient Vehicles Tax Incentives Extended
Extension of vehicle purchase tax exemption: Pursuant to the Announcement of the Ministry of Finance and the State Administration of Taxation of the Ministry of Industry and Information Technology on the Continuation and Optimization of the Vehicle Purchase Tax Reduction and Exemption Policy for New Energy Vehicles (No. 10 of 2023), new energy vehicles purchased between January 1, 2026 and December 31, 2027Reduction of vehicle purchase tax by half, of which the tax reduction is not more than 15,000 yuan per new energy passenger vehicle.
Technical requirements update: According to Announcement Nos. 24 and 25 of 2025, starting from January 1, 2026, the vehicle purchase tax exemption and vehicle and vessel tax incentives will be implemented in accordance with the new version of the Catalogue of New Energy Vehicle Models with Reduced or Exempted Vehicle Purchase Taxes and the updated technical requirements for energy-saving and new energy vehicle products.
Announcement No. 10 of 2024 of the Ministry of Industry and Information Technology, Ministry of Finance and General Administration of Taxation is hereby repealed.
Networked verification of export tax refunds
The Announcement of the General Administration of Customs and the General Administration of Taxation on the Implementation of the Network Verification of the "Certificate of Taxes Repaid/Unrefunded on Exported Goods" (No. 256 of 2025) is clear:
Beginning January 1, 2026, the two departments will implement electronic data verification in a network.
Enterprises can no longer apply for invalidation or replacement of the Certificate already used for customs clearance.
These new rules and regulations, from tax legislation, preferential policies, collection and management services and other levels, together constitute an important tax policy framework for 2026. Relevant enterprises and individuals are advised to pay attention to them in time, understand them accurately, and make tax planning and compliance arrangements in advance. If you have any questions about the specific operation, please feel free to inquire.
📢 Policy Source Disclaimer: The content of this article is based on: the State Administration of Taxation, the Ministry of Finance, the General Administration of Customs, the Ministry of Industry and Information Technology and other competent authorities in the 2025-2026 year of the public release of tax policy announcements collated and summarized, for reference only. Specific implementation is subject to official documents and explanations by tax authorities.
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