The rates
| China (VAT Law, in force 1 January 2026) | Portugal (IVA Code) | |
|---|---|---|
| Standard | 13 % — goods, processing and repair, leasing of tangible movables, imports (art. 10 n.º 1) | 23 % (22 % Madeira, 16 % Azores) |
| Reduced | 9 % — transport, postal and basic telecoms, construction, sale and leasing of real estate, transfer of land-use rights, farm produce, edible oil and salt, utilities, books and periodicals, feed and fertiliser (n.º 2) | 13 % (12 % / 9 %) — some food, wine, restaurant meals, musical instruments |
| Lowest | 6 % — all other services and intangibles (n.º 3) | 6 % (5 % / 4 %) — basic food, medicines, books, hotels, passenger transport, electricity |
| Exports | 0 % on exported goods and listed cross-border services (n.º 4–5) | exempt with credit (0 %) on exports and intra-EU supplies to VAT-registered customers |
| Small businesses | small-scale taxpayers pay 3 % on turnover without input credit (art. 11), reduced to 1 % and exempt below 100 000 CNY a month until 31 December 2027 | exempt below 15 000 € of turnover (art. 53.º), without input credit |
China’s headline rate is ten points below Portugal’s, and its VAT reaches services at 6 % that Portugal taxes at 23 %. On the other hand China’s 9 % applies to the sale of new housing and to construction, which Portugal exempts (housing) or taxes at 23 % (construction, 6 % for rehabilitation works on housing).
- 13 / 9 / 6 % in China against 23 / 13 / 6 % in Portugal
- 1 January 2026 — China's first VAT statute replaced the 1993 provisional regulations; the rates did not change
- 3 % → 1 % for small-scale taxpayers, exempt below 100 000 CNY a month, until 2027; 15 000 € exemption threshold in Portugal
- Imports: Chinese goods entering Portugal pay 23 % at customs on the customs value plus duty
How the two systems work
China distinguishes general taxpayers, who charge output VAT and credit input VAT under the general method, from small-scale taxpayers (annual sales below the State Council threshold, currently 5 million CNY), who pay the simplified 3 % — 1 % until 2027 — on turnover with no input credit. Exports are zero-rated with a refund of input tax at rates set by product. Tax is filed monthly or quarterly with the special VAT invoice (fapiao) as the only document that supports an input credit; the electronic fapiao is now the norm. Importers pay VAT at customs on the dutiable value plus customs duty and excise.
Portugal applies the EU directive: every business above 15 000 € registers, charges IVA on its invoices — issued from certified software, reported monthly through SAF-T — and deducts the IVA on its purchases; returns are monthly above 650 000 € of turnover and quarterly below, due by the 20th of the second month. Intra-EU B2B sales are zero-rated with the customer’s VAT number; sales to EU consumers above 10 000 € a year carry the customer’s country VAT through the one-stop shop; imports from outside the EU — China included — pay IVA at customs, or through the periodic return for registered importers who opt for it.
Trade between the two
- A Chinese factory selling to a Portuguese distributor: 0 % in China with export refund; 23 % Portuguese IVA at import on the customs value plus duty, deductible by the distributor.
- A Chinese web shop selling directly to Portuguese consumers: consignments up to 150 € can go through the EU import one-stop shop (IOSS) with 23 % charged at checkout; above that, IVA and duty at customs, paid by the buyer or the carrier.
- A Portuguese company exporting to China: 0 % in Portugal with proof of export; Chinese VAT at 13 % (or 9 %) at import, paid by the Chinese importer and creditable by a general taxpayer.
- Services: a Portuguese consultant invoicing a Chinese company charges no IVA (place of supply outside the EU); the Chinese customer withholds Chinese VAT at 6 % as the withholding agent under the VAT Law (art. 15). A Chinese firm supplying services to a Portuguese business invoices without Chinese VAT for exported services within the State Council list, and the Portuguese customer self-accounts 23 % under reverse charge.
Property and the two VATs
China charges 9 % on a developer’s sale of new housing and on construction services, 3 % (until 2026, 5 %) on an individual’s resale of a home held under two years and nothing after two years; individuals letting housing pay 1,5 %. Portugal exempts sales of housing from IVA (they carry IMT and stamp duty instead), taxes construction at 23 % with 6 % for rehabilitation works on housing and in urban rehabilitation areas (Lista I, items 2.23 and 2.27), and exempts residential rent. The property page has the full stack.
Steps
Classify the flow
Goods or services, B2B or B2C, where the customer is: that fixes which VAT applies and who pays it.
Register where needed
Portuguese IVA number for imports and local sales; IOSS for consumer parcels; a Chinese general-taxpayer status for input credits on the Chinese side.
Invoice correctly
Certified software and SAF-T in Portugal; fapiao in China — an invoice that fails either system loses the credit.
File on time
Monthly or quarterly IVA returns by the 20th; Chinese returns within the monthly or quarterly window.
We register Chinese-owned businesses for IVA, run certified invoicing and SAF-T, file the returns and the IOSS, and handle import IVA with your customs broker. Ask how your flows would be taxed.
Questions
Can my Portuguese company recover Chinese VAT paid on purchases in China?
Only through a Chinese VAT-registered entity that uses the purchase in its own taxable activity; there is no refund scheme for foreign businesses without Chinese registration. Structure Chinese purchases through the Chinese subsidiary or accept the VAT as a cost.
Do I charge IVA to a Chinese customer?
Not on goods exported (0 % with proof of export) nor on most services to a Chinese business (outside the EU place of supply); services to Chinese consumers follow the general rule of the supplier's country unless they are digital or property-related.
Is China's new VAT Law a rate change?
No. The law of 25 December 2024, applied from 1 January 2026, turned the 1993 provisional regulations into a statute and kept 13 %, 9 %, 6 % and the 3 % simplified rate; the 1 % reduction and the 100 000 CNY monthly exemption for small-scale taxpayers run under a separate announcement until the end of 2027.
Sources and official references
- Value-Added Tax Law of the PRC (adopted 25 December 2024, in force 1 January 2026) — art. 10 rates, art. 11 simplified rate 3 %, art. 15 purchaser as withholding agent, art. 23 threshold — checked 19.9.2026
- MOF/STA Announcement 2023 No. 19 — small-scale taxpayers: exemption below 100 000 CNY a month; 3 % reduced to 1 %; until 31 December 2027 — checked 19.9.2026
- State Taxation Administration — Tax System (VAT rates 13 / 9 / 6 since 2019; small-scale taxpayer threshold 5 million CNY; VAT Law adopted 25 December 2024) — checked 19.9.2026
- MOF/STA Announcement 2025 No. 17 — 3 % on individual home sales within two years from 1 January 2026; exempt after two years — checked 19.9.2026
- STA Announcement 2016 No. 16, art. 4 — individuals letting housing: 5 % reduced to 1,5 % — checked 19.9.2026
- Código do IVA, artigo 18.º — rates 6 %, 13 %, 23 %; regional rates — checked 19.9.2026
- Código do IVA, artigo 53.º — exemption up to 15 000 € of turnover — checked 19.9.2026
- Código do IVA, artigo 41.º — monthly returns above 650 000 €, quarterly below, by the 20th of the second month — checked 19.9.2026
- Código do IVA, artigo 27.º n.º 8 — option to pay import IVA through the periodic return — checked 19.9.2026
- Código do IVA, Lista I, items 2.23 and 2.27 — 6 % on rehabilitation works in urban rehabilitation areas and on housing — checked 19.9.2026
- Council Directive (EU) 2017/2455 — import one-stop shop for consignments of intrinsic value up to EUR 150; 10 000 € threshold for intra-EU distance sales — checked 19.9.2026