China Cancels Export Tax Rebate for Glass Bottles

China has officially canceled the value-added tax (VAT) export tax rebate for glass bottles, a key part of the country’s latest adjustment to export tax policies that took effect on April 1, 2026. The policy, jointly announced by the Ministry of Finance and the State Taxation Administration in Announcement No. 2 of 2026 released on January 8, covers glass bottles under Chapter 70 of the HS Code, marking the end of the long-standing tax rebate bonus for the glass bottle export industry.

Previously, glass bottles, including those used for packaging, transportation and preservation, were eligible for a 9% export tax rebate, which served as a crucial profit buffer for many exporters, especially small and medium-sized enterprises (SMEs) engaged in the production and trade of glass products. Under the new policy, all glass bottle products under relevant HS codes, such as 7010 and 7013, will no longer enjoy this rebate and will be taxed in accordance with domestic sales standards, subject to a 13% VAT.

The cancellation of the export tax rebate for glass bottles is not an isolated measure but part of China’s broader effort to optimize its industrial structure, curb vicious low-price competition and promote high-quality development of foreign trade.

Officials noted that the policy adjustment also aims to ease international trade frictions. In recent years, European and American countries have frequently initiated anti-dumping and anti-subsidy investigations against Chinese export products on the grounds of "government subsidies". Taking the initiative to cancel the export tax rebate is a key signal of China’s commitment to market-oriented pricing, which helps enhance the compliance and sustainability of China’s glass bottle exports in the global market.

The policy is expected to have a dual impact on the glass bottle export industry. In the short term, exporters, especially SMEs that rely heavily on tax rebates, will face increased cost pressure. Calculations show that for a glass bottle with an export price of 100 yuan, enterprises will lose 9 yuan of profit per unit without the tax rebate, and their profitability may decline significantly if they fail to pass on the cost to downstream customers. A wave of concentrated shipments was also observed before the policy took effect, temporarily increasing pressure on port logistics.

In the long run, however, the policy will accelerate industry restructuring and promote the concentration of resources in leading enterprises with technological and brand advantages. As overseas markets have a high dependence on Chinese glass products, high-quality enterprises can transfer costs through reasonable price increases and product structure optimization. The policy will also force enterprises to abandon low-price competition and shift their focus to technological innovation, product upgrading and brand building, opening up greater room for the development of high-value-added products such as special glass bottles and intelligent glass containers.

The cancellation of the export tax rebate for glass bottles is part of China’s broader shift in foreign trade policy from "scale expansion" to "quality improvement". It is estimated that the adjustment will help save about 62.424 billion yuan of fiscal funds in 2026, which will be redirected to support domestic core technology research and development, green and low-carbon transformation, and domestic demand expansion, aligning with the development pattern of "domestic circulation as the main body and dual circulation promoting each other".

Industry insiders suggest that glass bottle exporters should actively respond to the policy change by optimizing production and operation, controlling costs, upgrading product quality, and exploring high-end overseas markets to enhance their core competitiveness in the post-tax-rebate era.