China is taxing lithium-ion batteries while letting newer chemistries off. Announcement No. 20 of 2026, from the Ministry of Finance, the customs administration and the State Taxation Administration, set out the new rules.
What the announcement says
- From Sept. 1, 2026, lithium-ion batteries, along with several other battery types including lithium primary, nickel-metal hydride and vanadium flow batteries, pay a 2% consumption tax. The rate rises to 4% on Sept. 1, 2027.
- From Sept. 1, 2026, through Dec. 31, 2028, sodium-ion batteries, solid-state batteries and fuel cells are exempt, along with some advanced solar cell types.
- The exemption only applies to products that meet the relevant national standard. Makers need a test report from an accredited lab before claiming it.
Who wants to benefit
CarNewsChina reports that Hina Battery signed an agreement on Oct. 14 with Wuhan's Jiangxia District for a planned 10 GWh sodium-ion plant. The first phase is 3 GWh, construction starts in early 2027, and first output is expected before the end of that year. Hina is also working with Chengli on sodium-ion sanitation trucks. FAW Jiefang reported that a J6P tractor with a 339 kWh Hina pack kept more than 90% of its usable capacity at minus 40°C after more than 15,000 km of testing.
The catch
CNC notes that cheaper lithium has narrowed sodium-ion's cost case. Battery-grade lithium carbonate averaged about 97,000 yuan a tonne on Oct. 28, and LFP EV cells were about 0.41 yuan per Wh. Hina lists energy density of at least 145 Wh/kg, below mainstream lithium cells. The tax gap helps but, as CNC says, it does not prove sodium-ion is cheaper to make. For Tesla and every carmaker buying cells in China, the 2% to 4% tax on lithium-ion packs is a new cost.
