China VAT Guide for 2026: Rates, Registration & Compliance
China's standard VAT rate is 13%, with reduced 9% and 6% bands by sector. Covers general vs. small-scale taxpayer status, fapiao invoicing, and filing obligations for businesses operating in China.
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Key Takeaways
China's VAT applies at three general-taxpayer rates — 13% on most goods, 9% on transport and real estate, and 6% on modern and financial services, which includes software and SaaS — with a reduced 3% collection rate for small-scale taxpayers. A business with annual taxable sales above RMB 5 million registers as a general VAT taxpayer; China has no dedicated foreign-vendor digital-services registration regime distinct from ordinary VAT rules. Exports are zero-rated; SaaS and digital services are treated as modern services, taxable at 6% for a general taxpayer (3% for small-scale suppliers).
Taxability Snapshot
SaaS
Taxable
Digital Goods
Taxable
Sales Tax Rates
China's Value-Added Tax (VAT) applies at three general-taxpayer rates — 13% on most goods, 9% on transport, construction, and real estate, and 6% on modern and financial services, which includes software and SaaS. Small-scale taxpayers use a 3% collection rate. Exports are zero-rated. The State Taxation Administration (STA) administers it, and China's first unified VAT Law took effect 1 January 2026 [1][2].
Rate | Applies to |
|---|---|
13% | Most goods and manufacturing |
9% | Transport, construction, real estate, utilities |
6% | Modern and financial services, including SaaS |
3% | Small-scale taxpayers (simplified) |
For more detail, see our APAC VAT guides.
China VAT Calculator
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China · VATRates as of August 2026. Source: STA: VAT Law (2026) (opens in a new tab); State Council: VAT Law Implementing Regulations (opens in a new tab).
China · Standard rate
13%
VAT rate
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This is an estimate. Whether a sale is taxable, and at which rate, depends on what you sell, who you sell to and where it's supplied. If you intend to rely on these rates, please use the Kintsugi platform.
Registration & nexus threshold
China uses VAT taxpayer classification, not US-style economic nexus. A business with annual taxable sales above RMB 5 million must register as a general VAT taxpayer and charge 13%, 9%, or 6% depending on the supply, crediting input VAT, while those below the line are small-scale taxpayers taxed at a reduced levy rate [3]. China has no foreign-vendor VAT registration regime for digital services. Where an overseas supplier without an establishment in China sells services to a Chinese customer, the Chinese purchaser acts as withholding agent and remits the VAT [3]. Registration steps are in the How to Register section.
Filing frequency & deadlines
General taxpayers file monthly, due by the 15th of the following month, with some filing quarterly; small-scale taxpayers generally file quarterly. VAT on cross-border services is remitted by the domestic withholding agent on its own cycle at the time of payment, so a foreign supplier usually files nothing directly [1][2].
Exemptions
Exports of goods and qualifying cross-border services are zero-rated, and the VAT Law lists limited non-taxable and exempt items. SaaS and digital services are taxable, treated as modern services at 6% for a general taxpayer (3% for a small-scale supplier) [1][2].
Penalties
Overdue VAT carries a surcharge of 0.05% of the unpaid tax per day, about 18% a year. Underpaid or evaded tax can be fined between 0.5 and 5 times the amount owed, and false or missing fapiao (VAT invoices) carry separate, often severe, penalties [1].
Sources
[1] State Taxation Administration — Transactions subject to the 13% VAT rate
[2] State Taxation Administration — Transactions subject to the 9% VAT rate
[3] State Taxation Administration — China's tax system (VAT structure and administration)
[4] State Taxation Administration — China adopts the Value-Added Tax Law (effective 1 January 2026)
Verified July 2026 against State Taxation Administration guidance.
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