China’s New Tax Arrears Measures 2026 (Order No. 61): What Businesses Need to Know
China’s State Taxation Administration officially enacted the Measures for Announcement of Tax Arrears (Order No. 61) on 1 March 2026 — the first major overhaul of China’s tax arrears framework since 2005. The new rules create a more transparent, standardized system for managing and publicly disclosing tax arrears, while directly linking non-compliance to China’s social credit system. Businesses operating in China need to act now to protect their compliance ratings, financing eligibility, and market access.
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What Are the Key Changes Under China's Tax Arrears Order No. 61?
The updated regulations broaden what qualifies as “tax arrears.” Beyond simply unpaid taxes, the definition now explicitly covers:
- Taxes reported but not paid
- Taxes unpaid after an approved extension deadline
- Taxes assessed through a tax audit
- Taxes assessed directly by tax authorities
Importantly, late payment penalties on already-paid taxes will also be publicly disclosed — significantly increasing transparency around the full cost of non-compliance.
Tax arrears will now be announced monthly via:
- The administrative law enforcement information platform (primary)
- The e-tax bureau, local tax offices, and media (supplementary)
- Searchable provincial tax authority databases
Disclosed information includes the arrears period, payment due date, outstanding amount, corresponding late payment surcharges, and identifying details such as the business license number.
The new measures include a 3-business-day pre-announcement confirmation period, during which taxpayers can:
- Review pending disclosures
- Submit documentation to object or request corrections
- Seek corrections of already-published information
The following situations are exempt from public disclosure:
- Taxes collected during active bankruptcy proceedings not yet deposited into the treasury
- Arrears arising after a company has been legally dissolved
- Unpaid portions under bankruptcy reorganization or settlement plans
- Cases involving state secrets or other circumstances where disclosure is inappropriate
These carve-outs prevent unnecessary reputational damage to companies undergoing lawful restructuring.
Tax arrears now directly affect a company’s tax compliance rating under China’s social credit framework. Poor ratings can impact:
- Eligibility for government subsidies and incentives
- Access to financing and capital markets
- Participation in public tenders and procurement
- Overall business reputation in China
What Should Businesses Do Now?
To stay compliant under Order No. 61, businesses should prioritize:
- Tighten tax payment deadlines — Monitor post-filing dates and extension expirations closely to prevent delays.
- Respond promptly to pre-announcement notices — Use the 3-business-day window to review disclosures and file objections with supporting documentation if needed.
- Integrate tax compliance into credit risk management — Treat your tax payment record as a financial risk factor affecting financing and market access.
- Maintain thorough internal records — Archive documentation related to tax disputes, payments, and resolution processes for audit readiness.
