China Establishes New Policy for Domestic Entities to Withhold and Remit VAT for Natural Persons

China has established a new policy for domestic entities to withhold and remit VAT on behalf of natural persons. The new policy was established through Announcement No. 28 of 2026, jointly issued by the Ministry of Finance and the State Taxation Administration on 3 September 2026.

The new policy provides that when domestic natural persons provide specific services to domestic entities, the purchasing entity is legally responsible for withholding and remitting the VAT due if the single or da…