Market rumours circulated about a potential adjustment to value-added tax policies affecting internet services in China, The Standard reported Tuesday.

Mainland media later cited brokerage analyses saying the claims were unfounded, noting that internet and financial services fall under different tax categories and that a VAT hike would lack legal and policy basis, according to the report.

Companies that could be potentially affected include Tencent (HKG:0700), Alibaba (HKG:9988), and Kuaishou Technology (HKG:1024), which operate across gaming, e-commerce, and short-video services.

The speculation reportedly followed authorities' recent increase in the VAT rate on basic telecommunications services to 9% from 6%, fuelling broader discussion of potential tax changes across the digital economy.

Shares of Tencent fell 2%, while those of Alibaba and Kuaishou slipped over 1% in recent trade.

(Market Chatter news is derived from conversations with market professionals globally. This information is believed to be from reliable sources but may include rumor and speculation. Accuracy is not guaranteed.)