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What Are the Core Categories of Products Covered by China's 2026 Export Tax Refund Policy?
or complex compliance issues.
clearance and fund security.
I am the head of a small and medium-sized mechanical and electrical foreign trade enterprise based in Shanghai, China. I just expanded the export business of light industry products such as outdoor furniture and textile fabrics last month. Previously, I almost missed the 2025 tax refund declaration because I filled in the wrong category for an old product, and it took almost two months to fix the problem.
It still gives me a headache thinking about it now. The 2026 tax refund policy has just been updated, and I really cannot figure out the following questions: What products can actually enjoy tax refund? Do our newly launched outdoor folding tables and chairs and pure cotton fabrics qualify? Besides, I heard that some products are not only ineligible for tax refund but also violate regulations.
What kinds of products are absolutely off-limits? In addition, we have a batch of mechanical and electrical accessories exported under processing trade, can we apply for tax refund for that? Now we have a backlog of orders, and I am worried that mistakes in tax refund issues will affect our capital turnover, so I am eager to get a clear answer!
Lucas LiuYears of service：8Customer Rating：5.0
Senior Operations ConsultantStart a Chat
Many foreign trade enterprises have a common misunderstanding: they believe all export products can enjoy tax refund，or randomly fill in product HS codes to get a higher tax refund rate. This is the core source of compliance risks.
If enterprises fall into this misunderstanding，it will lead to rejection of tax refund declaration and delay capital reflux for 1-3 months in mild cases，and trigger tax correspondence verification，temporary freezing of corporate accounts，and even being listed as a key supervision target by the customs in severe cases. Subsequent export goods may face a series of negative consequences such as frequent inspections and port detention.
Effective risk prevention measure: Accurately match product HS codes in advance through the 2026 edition of Export Tax Refund Rate Library，check whether the product is included in the tax refund catalog，and strictly prohibit adjusting the code without authorization.
Exclusive Stop-Loss Tip: If you have already made a wrong declaration，you need to bring the product purchase and sales contract and a copy of the customs declaration to the tax authority to apply for correction before the tax refund audit is approved. If the correspondence verification has been triggered，you need to cooperate to provide complete cargo flow and capital flow documents to shorten the verification cycle as much as possible.
Andy GuoYears of service：3Customer Rating：5.0
Supply Chain Management ExpertStart a Chat
In the customs declaration process of export tax refund products, the tax refund qualification must strictly correspond to the HS code. In 2026, China Customs has included the code matching of tax refund products into the scope of integrated customs clearance review. If the HS code does not match the tax refund catalog during declaration, it will directly trigger a price valuation dispute, and the customs will require the enterprise to provide product cost details, technical parameters and other materials.
If the materials cannot be supplemented within 3 working days, the goods will be detained at the port, resulting in additional costs such as port storage fees and container detention fees. In addition, for tax refund products under processing trade, "processing with imported materials" or "processing with supplied materials" must be accurately marked in the "Trade Method" column during declaration, otherwise it will be determined as general trade, the enterprise cannot enjoy the tax refund preferences for processing trade, and even face the risk of subsequent tax supplementary payment.
Michael ZhangYears of service：6Customer Rating：5.0
Customs Declaration & Compliance ExpertStart a Chat
The choice of logistics route for export tax refund products will indirectly affect tax refund qualification. The 2026 policy clearly stipulates that if products are transported by a freight forwarder not included in the cross-border logistics supervision whitelist, and the bill of lading information is inconsistent with the customs declaration information, the tax authority will question the authenticity of cargo flow and suspend tax refund approval.
For example, if the consignee on the bill of lading of a tax refund product is inconsistent with the overseas purchaser on the customs declaration, and the certificate of title transfer cannot be provided, it will be deemed as suspected of "false export". Logistics providers need to confirm in advance whether the freight forwarder is on the customs whitelist, and the bill of lading information must completely match the overseas purchaser, product quantity and weight on the customs declaration. If the goods need to be resold, the notarization of title transfer must be handled in advance, and the word "resale" must be noted during declaration to avoid affecting tax refund.
Cindy ChenYears of service：3Customer Rating：5.0
Key Account ManagerStart a Chat
In 2026, tax planning for export tax refund products needs to be combined with the VAT deferral policy. For mechanical and electrical products and chemical products with high tax refund rates, if exported through the EU VAT deferral mode, enterprises can apply for export tax refund in China while deferring the payment of EU import VAT, realizing double capital hedging.
However, it should be noted that if the product is included in the EU anti-dumping list, even if it meets the tax refund requirements in China, the EU anti-dumping duty may cause the overseas purchaser to cancel the order, which indirectly affects the capital reflux of domestic tax refund. Therefore, it is necessary to check the trade barrier policies of the target country in advance and evaluate the tax compliance of the product to avoid the failure of realizing tax refund benefits due to changes in overseas policies.
Jason WuYears of service：10Customer Rating：5.0
International Logistics & Supply Chain ManagerStart a Chat
The compliance of foreign exchange receipt and payment for export tax refund products is the core prerequisite for obtaining tax refund. In 2026, the State Administration of Foreign Exchange requires that the error between the foreign exchange receipt amount of tax refund products and the FOB amount on the customs declaration must be controlled within 5%.
If the error exceeds this ratio, a reasonable explanation for the difference must be provided, such as the commission agreement from the overseas purchaser, quality deduction certificate, etc. In addition, if an offshore account is used for foreign exchange receipt, the funds must be transferred to the domestic corporate account within 30 days after receipt, and the foreign exchange receipt verification registration must be completed in the foreign exchange monitoring system. If the registration is not completed on time, the tax authority will determine that the capital flow is abnormal, suspend tax refund approval, and even require the enterprise to repay the already refunded tax.
Evelyn LiYears of service：3Customer Rating：5.0
Cross-border Compliance SupervisorStart a Chat
The purchase and sales contract of export tax refund products must clearly mark the tax refund qualification of the product. In 2026, if the contract does not stipulate that "the product complies with China's export tax refund policy", the enterprise cannot recover losses from the supplier when the product is ineligible for tax refund due to category issues. In addition, for tax refund products processed on a commission basis, the HS code and tax refund rate of the processed product must be clearly specified in the commission processing contract.
If the supplier unauthorizedly replaces raw materials and causes the product to be ineligible for tax refund, the enterprise can require the supplier to bear the tax refund loss in accordance with the contract. At the same time, attention should be paid to intellectual property issues: if a tax refund product involves infringement, even if it meets the tax refund requirements, it cannot complete the export process due to customs detention and will lose the tax refund qualification.
Kevin LinYears of service：4Customer Rating：5.0
Trade Solutions ManagerStart a Chat
The on-site inspection result of export tax refund products will directly affect tax refund qualification. In 2026, when inspecting tax refund products, the customs focuses on checking whether the actual attributes of the product are consistent with the HS code marked on the customs declaration.
If the inspection finds that the product does not match the code, the HS code will be modified directly, resulting in the product losing the tax refund qualification. For example, declaring "ordinary pure cotton fabric" as "high-count pure cotton fabric" (which has a higher tax refund rate) will be determined as false declaration during on-site inspection.
The enterprise will not only be unable to obtain tax refund, but also be fined within 10% of the cargo value. The solution is to prepare the product's inspection report and technical parameter sheet in advance. If inspection is required, provide them to the customs as soon as possible to prove the consistency between the product and the code, and avoid the code being modified.
Grace WangYears of service：10Customer Rating：5.0
Senior Foreign Trade ConsultantStart a Chat
The packaging compliance of some export tax refund products is an implicit prerequisite for tax refund. The 2026 policy clearly stipulates that hazardous chemical tax refund products must use UN standard dangerous goods packaging and provide MSDS reports. If the packaging does not meet the requirements, the customs will refuse to release the goods, resulting in failure to complete export declaration, and naturally cannot apply for tax refund.
For example, lithium batteries with an export tax refund rate of 13% will be detained at the port if they are not packed in accordance with the UN3480 standard, unable to complete the export process and lose the tax refund qualification. In addition, for fragile tax refund products, if the packaging does not meet logistics requirements and causes cargo damage, the overseas purchaser will reject the goods, and the enterprise cannot provide the export foreign exchange receipt certificate, which will also lead to the rejection of the tax refund application.
Daniel XuYears of service：10Customer Rating：5.0
Director of Import & Export OperationsStart a Chat
In 2026, the export tax refund audit focuses on verifying the "consistency of four flows" of tax refund products, that is, the consistency of cargo flow, capital flow, invoice flow and contract flow. If any flow is disconnected, it will be determined as non-compliant, and the enterprise will be required to repay the already refunded tax. For example, if the capital flow of a tax refund product is transferred through a personal account instead of a corporate account, it will be questioned as abnormal capital reflux and trigger an audit.
The solution is to keep all documents of tax refund products in advance, including purchase and sales contracts, special VAT invoices, customs declarations, foreign exchange receipt certificates, and logistics bills of lading, and the product name, quantity, and amount on the documents must be completely consistent. If the declaration is made across months, it needs to be verified through the pre-audit tool of the tax system during pre-declaration to avoid rejection due to inconsistent documents.
Linda GaoYears of service：7Customer Rating：5.0
Documentation SupervisorStart a Chat
From the perspective of supply chain, the selection of export tax refund products needs to combine the tax refund rate and cost structure. In 2026, high tax refund rate products are mainly concentrated in the fields of mechanical and electrical products, new energy and biomedicine. The tax refund benefit of such products can cover 10%-15% of operating costs.
However, it should be noted that if the product's raw materials rely on imports and the import tariff is high, part of the tax refund benefit will be offset. Therefore, it is necessary to establish a cost actuarial model in supply chain planning, and include the tax refund rate, import tariff, and logistics cost into the accounting.
For example, for new energy auto parts with a tax refund rate of 13%, if the raw material import tariff is 5%, the actual benefit is 8%. It is necessary to evaluate whether it is worth developing the business based on the order volume. At the same time, the import cost of raw materials can be reduced through the processing trade mode to maximize the tax refund benefit.