CHINA ENDS TAX BREAK FOR SOLAR AND LITHIUM BATTERIES

Beijing's decision to tax these products signals a regulatory tightening in sectors that have seen explosive growth and aggressive price competition. Solar and lithium-battery manufacturers have operated under consumption tax exemptions since around 2014, allowing them to maintain competitive pricing in domestic and export markets. The move reflects China's effort to balance industry growth with sustainable economic management. Intense competition has driven down costs but also compressed margins and prompted concerns about overproduction and quality standards. China dominates both industries globally, producing roughly 80% of the world's solar panels and a significant majority of lithium batteries. The tax will likely increase costs for manufacturers and potentially affect downstream industries including electric vehicles, energy storage, and renewable power systems that depend on these components. The timing and exact tax rates remain subject to further announcement. Industry analysts expect the measure could influence global clean-tech pricing and supply chains.