China will reduce the value-added tax rebate for new energy vehicle exports from 13% to 9% starting April 1, 2027. The Ministry of Finance and State Taxation Administration announced the change on October 12. The rate will be based on the export date recorded on the customs declaration; existing export consumption-tax rebate and exemption policies for applicable products will not change.
The lower rate applies to battery-electric and plug-in hybrid passenger cars, electric buses and electric truck tractors. It comes as Chinese automakers increasingly look overseas for growth. China exported 4.006 million NEVs in the first nine months of 2026, up 130% year on year, while September exports rose 160% to 571,000. Domestic NEV sales in September fell 9.4% to 1.252 million, according to figures cited from the China Association of Automobile Manufacturers.
Deutsche Bank estimates the cut could reduce BYD’s net profit by about 5,000 yuan (roughly $743) per exported vehicle, with the effect beginning in the second quarter of 2027. The bank said BYD sold 1,342,468 vehicles overseas in the first three quarters, around 43% of its wholesale volume, and expects the change to weigh on other exporters including Chery, Geely, SAIC, GWM, Changan, Leapmotor, GAC and Xpeng. The move follows reductions to export rebates for solar and battery products.