In a major policy shift, China’s State Taxation Administration has released Announcement No. 17 (2025)—a move that effectively bans the long-used “buy-license export” (买单出口) model.
Starting October 1, 2025 (retroactive to January 1), export agents must disclose the actual cargo owner in all declarations, targeting misuse of shell companies and borrowed export licenses.
🔍 Key Changes
- Mandatory Disclosure: Agents must report the real principal of each export, including:
- Full company name
- Unified Social Credit Code (USCC)
- Actual export value
- Penalties for Misreporting: If a shell company or freight forwarder is listed as the exporter, the agent is taxed as if it’s their own export—25% income tax on the entire amount.
🧾 Who Qualifies as the Actual Exporter?
To be recognized:
- The company must own the goods
- Must operate in trade or production within China
Multi-layered agency structures (A → B → C) are no longer valid unless the true owner (C) is disclosed at the point of declaration.
🚨 Impact on the Industry
The previous “buy-license” model allowed businesses to avoid tax by using agent companies to declare exports. Agents paid only 1–3% tax on service fees, while billions in revenue went untaxed.
Now, under the new policy:
- A ¥10M export with incorrect ownership can lead to ¥2.5M in corporate tax
- Agents are incentivized to reject non-compliant transactions
- The system integrates with Golden Tax Phase IV and customs records for risk tracking and validation
🛡️ Stronger Enforcement
The rule is enforced by five ministries:
- Taxation
- Customs
- Commerce
- Market Supervision
- Finance
Company deregistration now requires full tax clearance, shutting down the fast-exit loophole for shell exporters.
✅ What You Should Do
- Audit exports from January 1, 2025
- Verify ownership and documentation of each shipment
- Avoid using freight forwarders or shell companies as exporters of record
- Strengthen internal controls for compliance and reporting
China is moving toward total export transparency. Businesses relying on proxy licenses must urgently adjust—or face heavy penalties. Compliant, well-documented exports are now the only sustainable path forward.
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