News on China’s Cancellation of Export Tax Rebates Effective April 1, 2026, and Analysis of Its Impact on the Ceramic Tile Foreign Trade Industry

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On March 15, 2026, the Ministry of Finance and the State Taxation Administration jointly issued the “Notice on Adjusting Export Tax Rebate Policies for Some Products,” announcing the comprehensive cancellation of export tax rebates for ceramic tiles and related products effective April 1, 2026. This policy adjustment marks the official end of export incentive policies for ceramic products that have been in place for over thirty years and signifies a profound shift in China’s foreign trade policy from “scale-oriented” to “quality-oriented.”

According to the notice, this adjustment affects all building ceramic products under HS code 6907, including various glazed tiles, unglazed tiles, ceramic mosaics, and other related items. Unlike previous policy adjustments, this change does not include a transitional period. Starting April 1, 2026 (based on the declaration date of the export customs declaration form), the affected products will no longer be eligible for any export tax rebates.

In-depth Analysis of the Impact on the Ceramic Tile Foreign Trade Industry

I. Accelerated Supply Chain Restructuring
The implementation of this policy will trigger fundamental changes in the supply chain structure of the tile industry. Enterprises that have long relied on export tax rebates to maintain cost advantages will face survival tests. Industry analysis indicates that approximately 23% of export-oriented small and medium-sized ceramic enterprises may face production capacity adjustment pressures within the next 12-18 months. In contrast, companies with proprietary technology patents and brand advantages may reconfigure their global supply chains through overseas factory construction, technology licensing, and other models.

The new supply chain landscape will exhibit a distinct “dual-track” characteristic: on one hand, high-end product lines will accelerate their shift upstream in the value chain towards R&D and design; on the other hand, basic product manufacturing may relocate to regions with energy and raw material advantages, such as Southeast Asia and Africa. This division of labor restructuring will compel domestic enterprises to elevate their strategic positioning within the global industrial chain.

II. Imminent Innovation in Trade Models
Traditional trade methods like FOB and CIF can no longer meet competitive needs in the new policy environment. Three innovative trade models are expected to emerge in the industry: first, the “technology + capital” export model, providing technology and equipment to overseas partners in exchange for long-term profit sharing; second, the “brand licensing + localized production” model, leveraging brand value for asset-light operations; third, the “integrated solution” export model, transitioning from single product exports to bundled services including spatial design, material supply, and construction guidance.

Cross-border e-commerce platforms will play a key role in this adjustment cycle. By establishing overseas warehouses, developing B2B2C models, and building digital supply chains, enterprises can reduce intermediate links and increase profit margins. It is forecasted that the compound annual growth rate of cross-border e-commerce transaction volume in the tile industry could reach 35% over the next three years.

III. Technological Innovation Becomes the Core Competitiveness
Policy changes will directly drive technological upgrades in the industry. The proportion of R&D investment to sales revenue is expected to increase from the current 2.1% to 4.5% by 2028. Key technological breakthrough directions include: ultra-thin ceramic panel technology (thickness ≤ 3mm), functional surface treatment technologies (such as self-cleaning, antibacterial, photocatalytic), and digital production processes (such as AI quality control, intelligent manufacturing).

Green production technology will become an industry entry threshold. Indicators such as carbon emission intensity, water resource recycling rate, and comprehensive solid waste utilization rate will directly impact an enterprise’s international competitiveness. It is estimated that by 2028, energy consumption per unit product in the industry will decrease by 25% compared to 2023, and the proportion of enterprises with clean production certification will exceed 60%.

IV. Deep Adjustment of Market Structure
Export markets will shift from “blooming everywhere” to “focusing on deep cultivation.” Competitive strategies in traditional stronghold markets like Southeast Asia, the Middle East, and Africa will transition from price competition to value competition. It is projected that by 2027, the share of high-end products in total export value will increase from the current 18% to over 35%.

The development of emerging markets will exhibit new characteristics. Localized cooperation in countries along the “Belt and Road” will become the mainstream model, deepening market penetration through joint ventures, technology cooperation, etc. Meanwhile, breakthroughs in high-end markets like Europe and America will depend more heavily on design innovation and technical certifications. Products obtaining international green building certifications such as LEED and BREEAM will gain a clear competitive advantage.

V. Rebuilding the Industry Ecosystem
The policy adjustment will spur the development of a new industry ecosystem. Forms of cooperation such as industrial alliances, technology alliances, and market alliances will flourish. It is expected that 3-5 internationally influential ceramic industry innovation alliances will form within the next three years, creating synergies in areas like standard setting, technological R&D, and market expansion.

Financial service models will also innovate. Demand for professional financial services such as supply chain finance, optimized cross-border settlement, and exchange rate risk management will increase significantly. Concurrently, export credit insurance will focus on supporting the export of products with high technological content and high added value.

In summary, while this export tax rebate policy adjustment brings short-term growing pains to the industry, in the long term, it is a necessary process to propel China’s ceramic tile industry from a “manufacturing giant” to a “manufacturing powerhouse.” Enterprises that can quickly adapt to changes and actively pursue transformation and upgrading will find new development opportunities in the restructuring of the global value chain. The essence of the policy change is to drive the industry from competition based on cost advantages to competition based on technological and brand advantages, which aligns perfectly with the strategic direction of China’s overall manufacturing transformation and upgrading.