中国：北京宣布终止太阳能及电池产品出口增值税退税

Economics - Asia ex-Japan China: Beijing announces termination of VATrebates for exports of solar and battery products Research Analysts Asia Economics Harrington Zhang - NIHKharrington.zhang@nomura.com+852 2252 2057 The Ministry of Finance and the State Taxation Administration announced a new round ofcuts to value-added tax (VAT) rebates for exports of two key product categories: solar andbattery. Rebates for solar products will be fully terminated on 1 April 2026, while those forbatteries will be further lowered on 1 April 2026 before being completely cancelled on 1January 2027. We see several factors behind this move: the ongoing anti-involution driveto suppress excessive price competition and over-capacity, the surge in the trade surplus(above USD1.1trn in 2025) and rising trade tensions,especially with the EU (as wehighlighted recently ).Given the time window, we expect a notable front-loading of exportsfor solar products in Q1 and for batteries in H2. The termination of VAT rebates for greenproducts may push some Chinese manufacturers to set up more overseas factories. Thedecisive termination of VAT rebates for exports of solar and battery products also meansBeijing may preferusing non-exchange-rate tools to reduce its enormous trade surplusinstead of encouraging RMB appreciation. Ting Lu - NIHKting.lu@nomura.com+852 2252 1306 The first cut to export VAT rebates since late 2024 On 9 January, the Ministry of Finance and the State Taxation Administration jointlyannounced that VAT rebates for exports of solar products will be completely removed on 1April 2026 from the current level of 9%. VAT rebates for exports of battery products willfirst be lowered to 6% on 1 April 2026 from the current level of 9%, then completelycancelled from 1 January 2027. In the last round of cuts to export VAT rebates ,Beijing lowered the rebates for both solarand battery products to 9% from 13% on 1 December 2024. Therefore, while the latest cutannounced covers only two categories of products, it represents the most forceful reductionin export VAT rebates of specific products in recent years. Beijing’s outright termination ofrebates for both products reflects its determination to deal with the excessive investment,massive overcapacity and financial losses across those two sectors. The ongoing domestic anti-involution campaign Since the high-level policy meeting held by Beijing's top leadership in July 2025, Chinahas undergone a nationwide "anti-involution" campaign to curb issues of overcapacity,excessive and disorderly price competition, as well as severe corporate losses acrosssectors that have experienced rapid expansion of production capacity and an investmentfrenzy over the past several years. While the anti-involution drive has yet to bear material fruit on price reflation, it has causedsevere damage to investment in the manufacturing sector. Growth of fixed assetinvestment in electrical machinery and equipment manufacturing – which includes bothsolar and lithium-ion battery products – declined from -8.0% in Q2 to -12.2% in Q3 and -9.5% in October-November (Figure 2). Nevertheless, except for a slight rebound in pricesof upstream materials in solar, prices of downstream and finished products all remain athistorical lows (Figure 3), while battery prices also remain at rock bottom (Figure 4). Solar and battery exports surged in volume during 2025 Despite unprecedented trade tensions in 2025, volume growth of China's solar and batteryexports remained strong; however, fierce cuts to export prices meant value growthsignificantly underperformed volume growth. The divergence was particularly pronouncedfor solar products. Solar panel exports surged by 73.6% y-o-y in the first 11 months of2025 in volume terms but contracted by 9.6% in value USD terms (Figure 5). Batteryexports fared better in value terms, with lithium-ion battery shipments increasing by 25.6%in value terms while rising by 19.3% in volume terms (Figure 6). This stark gap betweenvolume and value growth likely highlighted to Beijing the troubling reality that, despiteselling vast quantities of products to overseas customers, China's manufacturers andworkers are capturing minimal, if any, profits. VAT rebates of solar and battery products in 2025 According to data released by the General Administration of Customs, the ChinaPhotovoltaic Industry Association and the China Passenger Car Association, we calculateChina’s total exports of solar and battery (mostly lithium-ion batteries) products totalledUSD96bn in the first 11 months of 2025. Given the 9% VAT rebate rate for the twoproducts in 2025, we estimate that the total export VAT rebate for the two products wasaround USD8.7bn in the first 11 months, or around RMB61.8bn based on the averageannual market exchange rate for USD/CNY in 2025. While not all products are eligible for export VAT rebate, we believe a majority of the twocategories are entitled to such rebates, and the number could also serve