The photovoltaic industry's tax rebate policy has been adjusted: the tax rate is reduced to 9%, and the industry expects the rebate rate to continue to decline.

According to the latest announcement from the Ministry of Finance and the State Taxation Administration, starting from December 1, 2024, China will adjust the export tax rebate rates for certain refined oil products, photovoltaic products, batteries, and some non-metallic mineral products, reducing them from the original 13% to 9%. This policy change involves photovoltaic products, including photovoltaic cells not mounted in modules or assembled into blocks (tariff code 85414200) and photovoltaic cells mounted in modules or assembled into blocks (tariff code 85414300).

Industry insiders generally believe that, although this may lead to increased costs for export enterprises in the short term, in the long run, reducing the tax rebate rate could potentially drive up the prices of overseas component products. In the half-month before the policy is implemented, some Chinese photovoltaic battery and component manufacturers may adopt a strategy of trading price for volume, increasing overseas sales orders to promote shipments.

Although the reduction in the tax rebate rate may reduce the profits of negotiated orders by about 4 percentage points, compared to the decline in component prices since the beginning of the year, this impact is relatively limited. For example, Wang Shujuan, the founder of Zhihui Photovoltaics, pointed out that with a component price of 0.7 yuan/W, a 4% reduction in the tax rebate rate only affects about 0.03 yuan/W, while the component price itself has dropped by about 0.3 yuan/W since the beginning of the year.

In addition, industry data shows that due to the imbalance of supply and demand in the photovoltaic industry, export prices have continued to decline, and the photovoltaic component prices in most markets have already dropped to a low of 0.08-0.09 USD/W. Therefore, reducing the tax rebate rate may be to prevent further declines in export prices and protect the healthy development of the domestic photovoltaic industry. Many industry insiders believe that gradually reducing the tax rebate rate is an adjustment direction, especially when Chinese photovoltaic products already have international competitiveness, and the adjustment of export tax rebate policies has little impact on the industry.