To bolster technological innovation and the growth of the manufacturing sector, and in line with the announcement from the Ministry of Finance and the State Taxation Administration on the VAT additional deduction policy for advanced manufacturing enterprises, the Ministry of Industry and Information Technology, the Ministry of Finance, and the State Taxation Administration have jointly issued a new notice. This notice outlines the procedures for compiling the 2026 list of advanced manufacturing enterprises eligible for this deduction, clarifying key requirements and timelines.

The list in question refers to advanced manufacturing enterprises that qualify as general VAT taxpayers within the manufacturing industry and hold High-Tech Enterprise status, including their non-legal-person branches. High-Tech Enterprise status is defined according to the identification measures stipulated in the Guoke Huo Fa [2016] No. 32 document, which sets the standards for recognition.

Local industry and information technology authorities, in coordination with their counterparts in science and technology, finance, and taxation, will be responsible for determining the enterprises that make it onto the 2026 list. To be included, an enterprise must maintain valid High-Tech Enterprise status throughout 2026 and meet specific criteria during the 2025 calendar year, including thresholds for R&D expenditure, R&D personnel, and the proportion of high-tech product revenue, all as per the established guidelines.

Additionally, the sales revenue generated from manufacturing activities must account for more than 50% of the enterprise's total sales, with all figures calculated excluding VAT. The classification of manufacturing activities should reference the 'Manufacturing' category (Category C) in the Industrial Classification for National Economic Activities (GB/T 4754-2017).

Applicants must also have a clean record for the 36 months preceding their application, meaning no instances of fraudulent export tax refunds, fraudulent retention tax credits, or issuance of false special VAT invoices, and no more than one penalty for tax evasion. For enterprises that outsource production, the associated sales will not count toward their manufacturing sales ratio, though processing fees can be included by the contracting enterprise if it meets the notice's conditions.

Enterprises should submit their applications through the High-Tech Enterprise Identification Management Network at http://www.innocom.gov.cn/. Those already on the 2025 list with valid High-Tech Enterprise qualifications can apply for 2026 renewal starting from September 2026, submitting between the 1st and 10th of each month, with a final deadline of April 10, 2027. New applicants can begin submitting from October 2026 under the same monthly schedule, also with an April 10, 2027 cutoff.

The benefit period varies based on the status of the enterprise's High-Tech Enterprise qualification. If the qualification is valid for the entirety of 2026, the enterprise can enjoy the policy from January 1, 2026, through April 30, 2027. If the qualification expires during 2026 and is not renewed, the benefit period ends on December 31, 2026. If it expires but is renewed within 2026, the enterprise retains the benefit until April 30, 2027. Newly certified High-Tech Enterprises in 2026 are eligible for the full period from January 1, 2026, to April 30, 2027.

For branches applying for the policy, the parent company must report all relevant information. In the case of VAT consolidated filing, the parent calculates sales and ratios for both entities, with only the parent potentially qualifying. For non-consolidated filings where the branch operates in manufacturing, both entities calculate independently, and their respective local authorities determine eligibility separately. Notably, transactions between parent and branch or among enterprises under common control do not qualify for the additional deduction on input VAT; these are entities within the scope of consolidated financial statements as per accounting standards. Furthermore, if an enterprise sells raw materials or semi-finished goods to another firm for processing and then repurchases them, the deduction can only be claimed on the input VAT related to the processing fees.

Local authorities are urged to enhance information sharing and coordination to simplify the tax filing process for enterprises. The industry and information technology departments will review manufacturing industry engagement, while science and technology agencies will verify High-Tech Enterprise qualifications, and tax authorities will audit general taxpayer status, compliance with high-tech conditions in 2025, and manufacturing sales ratios. Reviews will occur on a monthly basis, with local tax departments providing feedback on policy implementation and tax reduction outcomes by the end of each month starting November 2026.

Enterprises that undergo name changes, relocate, or experience significant changes affecting their eligibility must report these to the relevant High-Tech Enterprise identification body and update their information on the management network before reapplying for the policy. They should also notify the local industry and information technology department with supporting documents to confirm continued eligibility. Relocated enterprises must reapply in their new jurisdiction.

Applications are based on voluntary declaration, with enterprises taking full responsibility for the accuracy of their data and committing to comply with legal requirements. Authorities will strengthen oversight of listed enterprises, and if tax agencies discover non-compliance, such as failing high-tech conditions or obtaining tax benefits through false information, they will revoke benefits for the relevant period, recover owed taxes, and handle cases in accordance with tax collection laws. Enterprises that lose their high-tech status will be placed on a list of ineligible firms, subject to benefit termination and tax recovery measures. For enterprises on the 2025 list with unresolved matters, the provisions above will apply accordingly.

Attachments to the notice provide the application forms for the 2026 policy, the list of qualifying enterprises, and the list of those no longer eligible. The notice was issued on August 20, 2026, by the General Offices of the Ministry of Industry and Information Technology, the Ministry of Finance, and the State Taxation Administration.