China eases individual income tax on reverse invoicing for recycling transactions

China's State Taxation Administration has announced updated individual income tax regulations for natural-person sellers of scrap products, effective July 1, 2026, as part of broader efforts to promote large-scale equipment upgrades and consumer goods trade-ins.

Under the new rules, individuals selling scrap products to resource recycling companies via the "three-in-one reverse invoicing" mechanism will enjoy a reduced provisional tax rate. For annual sales volumes (VAT excluded) not exceeding RMB600,000 (USD88,349), the provisional individual income tax on business income will be levied at a reduced rate of 0.Asian Metal CopyrightChina's State Taxation Administration has announced updated individual income tax regulations for natural-person sellers of scrap products, effective July 1, 2026, as part of broader efforts to promote large-scale equipment upgrades and consumer goods trade-ins.Asian Metal Copyright25%, down from the current 0.Asian Metal Copyright For annual sales volumes VAT excluded not exceeding RMB600,000 USD88,349, the provisional individual income tax on business income will be levied at a reduced rate of 0.Asian Metal Copyright5%.Asian Metal Copyright 5 of 2024 concerning reverse invoicing by resource recycling companies for purchases from individual scrap sellers.Asian Metal Copyright Any portion of annual sales exceeding RMB600,000 (USD88,349) will continue to be taxed at the 0.Asian Metal Copyright Other service and collection provisions remain unchanged and will continue to follow the existing rules set out in the State Taxation Administration's Announcement No.Asian Metal Copyright5% rate.

Other service and collection provisions remain unchanged and will continue to follow the existing rules set out in the State Taxation Administration's Announcement No. 5 of 2024 concerning reverse invoicing by resource recycling companies for purchases from individual scrap sellers.
.Asian Metal Copyright For annual sales volumes VAT excluded not exceeding RMB600,000 USD88,349, the provisional individual income tax on business income will be levied at a reduced rate of 0Asian Metal Copyright