Impact of China Removing Export Tax Rebates for HS 391000 Silicone Materials

Starting 1 April 2026, China will officially remove export tax rebates for products classified under HS 391000, which covers primary-form organosilicon and polysiloxane materials. These materials include various silicone raw materials such as silicone oils, silicone gum, and other primary polysiloxanes, which serve as essential upstream inputs for many silicone-based manufacturing processes worldwide.

Previously, exporters in China were able to claim Value Added Tax (VAT) export rebates, typically ranging from 9% to 13%, when selling these materials to overseas buyers. With the cancellation of these rebates, exporters will no longer receive this refund, meaning the tax cost must now be absorbed by the exporter or passed on to international customers. As a result, export prices for these silicone materials are expected to increase by approximately 5% to 13%, depending on the previous rebate rate.

China remains the largest global producer of silicone materials, and any policy change affecting its exports can influence the global supply chain. The removal of these rebates may therefore lead to higher global silicone prices, particularly for companies importing materials under HS 391000 such as silicone rubber, silicone elastomers, and silicone oils. Some suppliers may also introduce additional surcharges after April 2026, further impacting procurement costs.

For manufacturers that rely on imported silicone rubber from China, the increase in raw material costs could translate into higher production costs for finished silicone products, potentially affecting overall product pricing and competitiveness in the global market.

At Silcotech Industry, supported by the Flexi Versa Group, proactive steps are already being taken to manage potential cost fluctuations and maintain supply stability for customers. These efforts include diversifying raw material sourcing, evaluating alternative suppliers, and optimizing material selection where possible.

By strengthening supply chain flexibility and maintaining close collaboration with material partners, Silcotech aims to minimize the impact of global silicone price changes while continuing to provide reliable silicone component manufacturing solutions.

If your business is affected by the upcoming changes in silicone material pricing or if you would like to explore alternative material options, cost-effective solutions, or silicone component manufacturing support, the Silcotech team is ready to assist.