Implementation Regulations of the Value-Added Tax Law of the People's Republic of China
Implementation Regulations of the Value-Added Tax Law of the People's Republic of China
Implementation Regulations of the Value-Added Tax Law of the People's Republic of China
Order of the State Council of the People's Republic of China No. 826
December 25, 2025
The Implementation Regulations of the Value-Added Tax Law of the People's Republic of China, which have been adopted by the 75th executive meeting of the State Council on December 19, 2025, are hereby promulgated and shall come into force from January 1, 2026.
Premier Li Qiang
Implementation Regulations of the Value-Added Tax Law of the People's Republic of China
Chapter I General Provisions
Article 1 These Regulations are formulated in accordance with the Value-Added Tax Law of the People's Republic of China (hereinafter referred to as the "VAT Law").
Article 2 For the purposes of Article 3 of the VAT Law, "goods" include tangible movable property, electricity, heat, gas, etc.
For the purposes of Article 3 of the VAT Law, "services" include transportation services, postal services, telecommunications services, construction services, financial services, and production and living services such as information technology services, cultural and sports services, and assurance and advisory services.
For the purposes of Article 3 of the VAT Law, "intangible assets" refer to assets without physical form that can generate economic benefits, including technology, trademarks, copyrights, goodwill, rights to use natural resources, and other intangible assets.
For the purposes of Article 3 of the VAT Law, "immovable property" refers to assets that cannot be moved, or would undergo a change in nature or shape upon being moved, including buildings, structures, etc.
The specific scope of goods, services, intangible assets, and immovable property shall be proposed by the competent finance and tax authorities under the State Council, which shall take effect after they are submitted to and approved by the State Council.
Article 3 For the purposes of Article 3 of the VAT Law, "entities" include enterprises, administrative authorities, public institutions, military units, social organizations, and other entities.
For the purposes of Article 3 of the VAT Law, "individuals" include individual businesses and natural persons.
Article 4 For the purposes of Item (4) of Article 4 of the VAT Law, "services or intangible assets are consumed within China" refers to the following circumstances:
(1) Where services or intangible assets are sold by overseas entities or individuals to entities or individuals within China, except for services consumed on-site outside China;
(2) Where services or intangible assets sold by overseas entities or individuals are directly related to goods, immovable property, or natural resources within China; and
(3) Other circumstances as prescribed by the competent finance and tax authorities under the State Council.
Article 5 When issuing a special VAT invoice, a taxpayer shall separately list the sales amount and the VAT amount.
Article 6 A taxpayer applying the general taxation method shall be considered as a general VAT taxpayer.
A registration system shall apply to general VAT taxpayers, and the specific registration measures shall be formulated by the competent tax authority under the State Council.
Article 7 Natural persons shall be deemed small-scale taxpayers. Non-enterprise entities that do not regularly engage in taxable transactions and whose primary activities do not fall within the scope of taxable transactions may opt to be treated as small-scale taxpayers.
Chapter II Tax Rates
Article 8 For the purposes of Item (4) of Article 10 of the VAT Law, "exported goods" refers to goods that are declared to Customs and physically leave the territory of China, and are sold to overseas entities or individuals, as well as other goods deemed as being exported as stipulated by the State Council.
Article 9 Entities or individuals within China that engage in cross-border sales of the following services or intangible assets shall be subject to a zero VAT rate:
(1) R&D services, contract energy management services, design services, radio, film and television production and distribution services, software services, circuit design and testing services, information system services, business process management services, and offshore service outsourcing services, all of which are provided to overseas entities and are fully consumed outside China;
(2) Transfer of technology that is fully used outside China to overseas entities; and
(3) International transportation services, space transportation services, and repair and replacement services provided to foreign parties.
Article 10 A taxable transaction as mentioned in Article 13 of the VAT Law shall simultaneously meet the following conditions:
(1) Two or more activities with different tax rates or levy rates are involved; and
(2) There is a clear principal–auxiliary relationship between the activities. The principal activity plays the dominant role and reflects the substance and purpose of the transaction; and the auxiliary activity is a necessary supplement to the principal activity and is conditional upon the occurrence of the principal activity.
Chapter III Tax Payable
Article 11 For the purposes of Article 16 of the VAT Law, "VAT deduction vouchers" shall comply with the relevant provisions of the competent tax authority under the State Council and specifically include special VAT invoices, special payment certificates of Customs for import VAT, tax payment certificates, agricultural product purchase invoices, agricultural product sales invoices, and other deduction vouchers capable of offsetting input tax.
Article 12 The input tax amounts deductible from output tax on the basis of VAT deduction vouchers obtained by taxpayers include:
(1) The VAT amount listed on a special VAT invoice obtained from the seller;
(2) The VAT amount listed on a special payment certificates of Customs for import VAT obtained from Customs;
(3) The VAT amount listed on a tax payment certificate obtained for services, intangible assets, or immovable property purchased from overseas entities or individuals;
(4) In the purchase of agricultural products, in addition to obtaining a special VAT invoice or a special payment certificate of Customs for import VAT, the input tax amount calculated based on an agricultural product purchase invoice or agricultural product sales invoice, unless otherwise provided by the State Council; and
(5) The VAT amount listed or included in other VAT deduction vouchers obtained from the seller.
Article 13 Where a taxpayer who calculates and pays VAT using the general taxation method refunds VAT to the purchaser due to sales discounts, termination, or return of goods, the refunded VAT amount shall be deducted from the output tax of the current period; where VAT is recovered due to sales discounts, termination, or return of goods, the recovered VAT amount shall be deducted from the input tax of the current period.
Article 14 Where a taxpayer who calculates and pays VAT using the simplified taxation method refunds sales amounts to the purchaser due to sales discounts, termination, or return of goods, the refunded sales amounts shall be deducted from the sales amount of the current period.
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Order of the State Council of the People's Republic of China No. 826
December 25, 2025
The Implementation Regulations of the Value-Added Tax Law of the People's Republic of China, which have been adopted by the 75th executive meeting of the State Council on December 19, 2025, are hereby promulgated and shall come into force from January 1, 2026.
Premier Li Qiang
Implementation Regulations of the Value-Added Tax Law of the People's Republic of China
Chapter I General Provisions
Article 1 These Regulations are formulated in accordance with the Value-Added Tax Law of the People's Republic of China (hereinafter referred to as the "VAT Law").
Article 2 For the purposes of Article 3 of the VAT Law, "goods" include tangible movable property, electricity, heat, gas, etc.
For the purposes of Article 3 of the VAT Law, "services" include transportation services, postal services, telecommunications services, construction services, financial services, and production and living services such as information technology services, cultural and sports services, and assurance and advisory services.
For the purposes of Article 3 of the VAT Law, "intangible assets" refer to assets without physical form that can generate economic benefits, including technology, trademarks, copyrights, goodwill, rights to use natural resources, and other intangible assets.
For the purposes of Article 3 of the VAT Law, "immovable property" refers to assets that cannot be moved, or would undergo a change in nature or shape upon being moved, including buildings, structures, etc.
The specific scope of goods, services, intangible assets, and immovable property shall be proposed by the competent finance and tax authorities under the State Council, which shall take effect after they are submitted to and approved by the State Council.
Article 3 For the purposes of Article 3 of the VAT Law, "entities" include enterprises, administrative authorities, public institutions, military units, social organizations, and other entities.
For the purposes of Article 3 of the VAT Law, "individuals" include individual businesses and natural persons.
Article 4 For the purposes of Item (4) of Article 4 of the VAT Law, "services or intangible assets are consumed within China" refers to the following circumstances:
(1) Where services or intangible assets are sold by overseas entities or individuals to entities or individuals within China, except for services consumed on-site outside China;
(2) Where services or intangible assets sold by overseas entities or individuals are directly related to goods, immovable property, or natural resources within China; and
(3) Other circumstances as prescribed by the competent finance and tax authorities under the State Council.
Article 5 When issuing a special VAT invoice, a taxpayer shall separately list the sales amount and the VAT amount.
Article 6 A taxpayer applying the general taxation method shall be considered as a general VAT taxpayer.
A registration system shall apply to general VAT taxpayers, and the specific registration measures shall be formulated by the competent tax authority under the State Council.
Article 7 Natural persons shall be deemed small-scale taxpayers. Non-enterprise entities that do not regularly engage in taxable transactions and whose primary activities do not fall within the scope of taxable transactions may opt to be treated as small-scale taxpayers.
Chapter II Tax Rates
Article 8 For the purposes of Item (4) of Article 10 of the VAT Law, "exported goods" refers to goods that are declared to Customs and physically leave the territory of China, and are sold to overseas entities or individuals, as well as other goods deemed as being exported as stipulated by the State Council.
Article 9 Entities or individuals within China that engage in cross-border sales of the following services or intangible assets shall be subject to a zero VAT rate:
(1) R&D services, contract energy management services, design services, radio, film and television production and distribution services, software services, circuit design and testing services, information system services, business process management services, and offshore service outsourcing services, all of which are provided to overseas entities and are fully consumed outside China;
(2) Transfer of technology that is fully used outside China to overseas entities; and
(3) International transportation services, space transportation services, and repair and replacement services provided to foreign parties.
Article 10 A taxable transaction as mentioned in Article 13 of the VAT Law shall simultaneously meet the following conditions:
(1) Two or more activities with different tax rates or levy rates are involved; and
(2) There is a clear principal–auxiliary relationship between the activities. The principal activity plays the dominant role and reflects the substance and purpose of the transaction; and the auxiliary activity is a necessary supplement to the principal activity and is conditional upon the occurrence of the principal activity.
Chapter III Tax Payable
Article 11 For the purposes of Article 16 of the VAT Law, "VAT deduction vouchers" shall comply with the relevant provisions of the competent tax authority under the State Council and specifically include special VAT invoices, special payment certificates of Customs for import VAT, tax payment certificates, agricultural product purchase invoices, agricultural product sales invoices, and other deduction vouchers capable of offsetting input tax.
Article 12 The input tax amounts deductible from output tax on the basis of VAT deduction vouchers obtained by taxpayers include:
(1) The VAT amount listed on a special VAT invoice obtained from the seller;
(2) The VAT amount listed on a special payment certificates of Customs for import VAT obtained from Customs;
(3) The VAT amount listed on a tax payment certificate obtained for services, intangible assets, or immovable property purchased from overseas entities or individuals;
(4) In the purchase of agricultural products, in addition to obtaining a special VAT invoice or a special payment certificate of Customs for import VAT, the input tax amount calculated based on an agricultural product purchase invoice or agricultural product sales invoice, unless otherwise provided by the State Council; and
(5) The VAT amount listed or included in other VAT deduction vouchers obtained from the seller.
Article 13 Where a taxpayer who calculates and pays VAT using the general taxation method refunds VAT to the purchaser due to sales discounts, termination, or return of goods, the refunded VAT amount shall be deducted from the output tax of the current period; where VAT is recovered due to sales discounts, termination, or return of goods, the recovered VAT amount shall be deducted from the input tax of the current period.
Article 14 Where a taxpayer who calculates and pays VAT using the simplified taxation method refunds sales amounts to the purchaser due to sales discounts, termination, or return of goods, the refunded sales amounts shall be deducted from the sales amount of the current period.
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