China Silicone Raw Material Tax Rebate Cancelled 2026: What Finished Product Importers Need to Know
If you’re importing finished silicone products from China, here’s something you need to know.
On April 1, 2026, China removed export tax rebates for primary-form polysiloxane – the raw material that all silicone products start from.
The good news: finished silicone goods still qualify for export tax rebates. That part hasn’t changed.
The less obvious news: the raw-material price shift will eventually affect finished goods pricing. Here’s how.
What actually changed
Only one HS code is affected: 39100000 – primary-form polysiloxane (unprocessed silicone rubber in its raw state).
Before the policy change, exporters could claim a tax rebate on this raw material. Now they can’t. That adds roughly 1,600 RMB (about $220 USD) per ton to raw-material export costs.
What did we see when the policy took effect? A rush of pre-policy shipments in Q1 – factories trying to get raw materials out before April 1 – followed by a sharp drop in Q2. That kind of volatility creates ripple effects throughout the supply chain.
Why this matters to you, the buyer
You might think: “I don’t buy raw materials – I buy finished products. Why should I care?”
Here’s why.
About 70-80% of China’s silicone product factories are “mid-small workshops” – they buy all their raw rubber from external suppliers. They don’t make their own compounds. So when raw-material costs go up, they feel it immediately.
These factories have two choices:
- Raise prices – pass the cost to you
- Squeeze their own margins – which often leads to quality shortcuts
Neither option is good for you. And here’s where it gets trickier.
The compliance layer
At the same time raw-material costs are shifting, compliance requirements are getting stricter.
| Regulation | What’s changing |
|---|---|
| EU REACH | D4 and D5 siloxane substances under tighter control |
| LFGB (Germany/Food) | New N-nitrosamine limits for baby-contact silicone |
| Material changes | Many shipments get rejected because suppliers didn’t re-test after switching raw-material sources |
Here’s a scenario that happens more often than you’d think:
A factory switches to a cheaper raw-material supplier to protect margins after the tax-rebate change. They don’t re-run the full compliance tests. The shipment arrives at port. Customs pulls it for inspection. The material doesn’t match the original test report. Shipment gets held, returned, or destroyed.
An FDA certificate doesn’t guarantee clearance in Europe. Batch-to-batch testing does. And not all factories do it.
What we recommend buyers do
Based on what we’re seeing in the market, here are three practical steps:
1. Don’t lock in long-term pricing based on old cost levels.
Raw-material prices are still settling after the policy change. If you lock a 12-month contract at historical lows, you might find your supplier coming back mid-year asking for a renegotiation – or worse, cutting corners to stay profitable.
2. Ask your supplier about their raw-material sourcing.
Do they make their own compound? Or do they buy from external suppliers? The answer tells you a lot about their cost stability and quality control. Integrated manufacturers (who make their own raw compound) are in a better position to absorb this kind of policy shock.
3. Request updated compliance documents – every batch.
Not just one FDA certificate you hold onto for years. Ask for batch-specific test reports, especially if your supplier has switched material sources recently. LFGB and REACH compliance need to be verified batch by batch.
What we’re doing at Evermore
We’re an integrated silicone manufacturer – we manage our own raw-material compound and have long-term supply agreements with our raw-material partners. That means we can absorb more cost volatility than factories that buy rubber on the spot market.
We also batch-test and document every production run, so when your shipment arrives at customs, the test reports match the materials inside.
Looking ahead
The tax-rebate change isn’t the end of the world. But it’s a sign that the cost structure of Chinese silicone manufacturing is shifting. Buyers who understand this shift – and ask the right questions – will continue to get consistent quality and stable pricing. Those who don’t will be the ones dealing with surprise cost increases and delayed shipments.
We’d rather be transparent about this now than explain a price increase later.
About Zhangzhou Evermore New Material Technology Co., Ltd. (漳州永越新材料技术有限公司)
We are a silicone manufacturer in China with in-house raw-material management, full FDA/LFGB certifications, and batch-to-batch quality testing. Whether you need silicone kitchenware, baby products, or custom-designed components, we handle OEM and ODM projects from raw material to finished goods.
Contact us:
Website: https://www.evermoresilicone.com/
Alibaba: https://evermorecn.en.alibaba.com/
Email: info@evermorecn.com
WhatsApp/WeChat: 86-13599531567