China to Reintroduce NEV Purchase Tax in 2026, Signalling Post-Subsidy Market Normalization
From 2026, China will apply a 5% purchase tax to most NEVs and tighten PHEV technical requirements, ending a long period of full purchase-tax exemptions. The shift is likely to pull demand into late 2025, pressure OEM margins through tax-offset offers and pricing tactics, and raise compliance and export-policy risks heading into 2026.