By China’s government has announced a phased reduction and eventual elimination of value-added tax (VAT) export rebates on battery products, a move that is reshaping global battery metals markets.
Under the new plan, the current 9 % VAT rebate will be cut to 6 % in April and completely scrapped by January 1, 2027. This policy shift aims to curb excessive competition, manage industrial overcapacity, and refocus domestic production incentives.
The announcement triggered a sharp rally in lithium prices this week, with the most actively traded lithium carbonate futures climbing significantly — the highest level in over two years.
Market participants are accelerating shipments ahead of the rebate phase-out deadline, tightening near-term supply and reinforcing bullish sentiment across battery raw materials markets. The decision projects China’s growing influence in strategic metals used for electric vehicles and energy storage.
