China's State Administration of Taxation has issued Announcement No. 13 of 2026, which concerns the special tax treatment for corporate restructuring transactions, including mergers and divisions. Special tax treatment is essentially a tax deferral mechanism. Under general tax treatment, when an enterprise restructures, it must treat the transfer of assets or equity as a taxable event based on fair market value, recognizing immediate gains or losses. However, if a transaction qualifies for s…