Editor's Note: As a pillar industry of the national economy, tax collection and administration of the petrochemical industry is not only related to the stability of national fiscal revenue but also plays a guiding and regulating role in the high-quality development of the industry. Currently, the reform of tax collection and administration is continuously deepened. The central government focuses highly on the supervision of refined oil consumption tax, with multiple departments intensively introducing regulatory policies and intelligent supervision methods being accelerated. The intensity of joint crackdowns on tax-related violations continues to increase. Coupled with the expectation of consumption tax reform and the clarification of judicial adjudication rules, petrochemical enterprises are facing a new round of systematic escalation of tax-related risks. Based on the latest policy dynamics, regulatory practices and typical cases, this article systematically sorts out the seven major trends in tax collection and administration of the petrochemical sector in 2026, providing references for industry enterprises to respond to regulatory changes and solidify the foundation of tax compliance.

 

01 Inspection and Rectification Lead to Strengthened Supervision, with the Refined Oil Industry Becoming a Key Focus Area

From April 15 to July 20, 2024, the First Central Inspection Group conducted a regular inspection of the Party Committee of the State Taxation Administration (STA) and fed back the inspection opinions on October 21 of the same year. Nearly a year later, in September 2025, the official website of the STA released a notice on the progress of rectification, clearly listing tax supervision of the refined oil industry as a key rectification item, demonstrating the central government's high attention to tax issues in this field. To implement the rectification requirements, the STA has launched three key measures: first, issuing three policy guidelines on refined oil consumption tax; second, researching and revising the annotations on the scope of refined oil consumption tax collection; third, formulating and issuing the Interim Measures for the Administration of the Testing of Tax-Related Refined Oil Products . From the content of the notice, these measures directly address the long-standing disputes between tax authorities and enterprises in the refined oil industry, such as the ambiguous definition of taxable and non-taxable products and unclear scope of consumption tax collection. Through policy improvement and institutional innovation, the STA promotes the tax supervision of the refined oil industry towards legalization and standardization, forming a clear orientation of strengthening tax source supervision, cracking down on tax-related violations, and creating a fair tax environment.

The focus of central inspection and rectification on tax supervision of the refined oil industry conveys three clear signals. Firstly, as a major tax source, the petrochemical industry will inevitably become a long-term focus of regulatory attention in terms of tax compliance. Secondly, the resolution of disputes between tax authorities and enterprises will rely more on clear policy guidelines and standardized testing processes, significantly reducing the discretionary space. Thirdly, regulatory authorities will focus more on consolidating the foundation of tax collection and administration through institutional improvement rather than relying solely on post-event inspections. For enterprises, it is necessary to actively align with the latest policy requirements, comprehensively sort out tax-related risk points in their own businesses, especially attach importance to key links such as the qualification of refined oil products and consumption tax declaration, and establish compliance management mechanisms in advance to avoid tax risks caused by deviations in policy understanding.

02 Multi-departmental Collaboration to Build a Full-Chain Policy Supervision System

Since 2025, multiple departments including the State Council, the STA, the Ministry of Commerce, and the Ministry of Industry and Information Technology (MIIT) have intensively worked on tax supervision of the petrochemical industry, successively introducing special policies to form a full-chain regulatory policy system covering refined oil circulation, tax-related testing, stable industry growth, and infrastructure management, laying a institutional foundation for the deepening of supervision in 2026.

From the perspective of the implementation rhythm of specific policies, in February 2025, the General Office of the State Council took the lead in issuing the Opinions on Promoting the High-Quality Development of Refined Oil Circulation (Guo Ban Fa〔2025〕No. 5), clarifying that enterprises engaged in refined oil wholesale and warehousing operations must first complete the filing with the competent commercial department before activating the invoice issuance module at the tax department. It also requires enterprises to establish complete purchase, sales and inventory accounting books and voucher files, and realize full-chain dynamic digital supervision through the cross-departmental data sharing mechanism. Subsequently, in March, the STA issued the Interim Measures for the Administration of the Testing of Tax-Related Refined Oil Products (Announcement No. 7 (2025) of the State Taxation Administration) , which, with detailed provisions in seven chapters and sixty articles, clarifies the core content such as testing subjects, processes, costs, and result handling, covering all subjects in the upstream and downstream of the industrial chain and all types of oil products, providing a clear and operable basis for the definition of taxable products.

Later, in August, the Ministry of Commerce issued the Measures for the Administration of Refined Oil Circulation (Decree No. 4 (2025) of the Ministry of Commerce), further refining regulatory requirements, distinguishing between wholesale and warehousing filing management and retail licensing management, requiring enterprises to submit purchase, sales and inventory data monthly, and establishing a credit rating evaluation and differentiated supervision mechanism. Focusing on the long-term development of the industry, in September, seven departments including the MIIT, the Ministry of Ecology and Environment, the Ministry of Emergency Management, and the People's Bank of China jointly issued the Work Plan for Stabilizing Growth in the Petrochemical and Chemical Industry (2025-2026), proposing the goal of an average annual growth of more than 5% in industry added value from 2025 to 2026. While promoting industrial technological innovation and digital empowerment, it also clarifies the direction for the simultaneous upgrading of supervision. In November, the National Development and Reform Commission (NDRC) issued the Measures for the Planning, Construction and Operation Management of Oil and Gas Infrastructure (Decree No. 35), focusing on infrastructure guarantee, requiring cross-border and inter-provincial pipeline projects to be included in the national unified plan, encouraging social capital to participate in construction, and improving the traceability of tax supervision through the standardized operation of infrastructure.

The intensive introduction of a series of regulatory policies in 2025 indicates that multi-departmental collaborative supervision will continue to deepen in 2026. From the perspective of policy logic, supervision presents three major trends: first, the supervision scope extends from a single link to the full chain including production, circulation, warehousing, and retail; second, the supervision method shifts from "strict access" to "wide access with strict supervision", stimulating market vitality while adhering to the bottom line of compliance; third, the supervision basis is upgraded from principled provisions to refined operational guidelines, resolving disputes between tax authorities and enterprises at the source. For petrochemical enterprises, it is necessary to establish a cross-departmental policy tracking and interpretation mechanism, and focus on the new compliance requirements brought by policy superposition. For example, it is necessary to ensure the timely connection between commercial filing and the invoice issuance module of the tax system, maintain the consistency between purchase, sales and inventory data and tax declaration data, and avoid chain risks caused by omissions in a single link.

03 In-depth Advancement of Intelligent Supervision, "Governing Tax Through Data" Reshapes the Pattern of Collection and Administration

Relying on the in-depth application of technologies such as big data and the Internet of Things, tax supervision of the petrochemical industry is accelerating its transformation towards digitalization and intelligence. Represented by the digital electronic invoices promoted nationwide since December 2024, coupled with the intelligent tax control platforms successively launched in various regions, a full-chain digital supervision system has initially taken shape.

In the implementation and application of digital electronic invoices, refined oil enterprises need to uniformly handle purchase, sales and inventory management and invoice issuance through the "refined oil business" module in the tax digital account. Distribution enterprises can query inventory accounting books and business details in real time, realizing the accurate matching of invoice flow and goods flow. Tax authorities implement dynamic invoice issuance quota management through the electronic invoice service platform, automatically adjusting the quota based on multi-dimensional indicators such as enterprise risk level, tax credit, and business behavior, and adopting control measures such as reducing or even zeroing the quota for enterprises with risks such as long-term tax arrears and obvious mismatch between input and output taxes. In practice, the "digital electronic invoice + big data" supervision model has achieved remarkable results. Many places across the country have successfully investigated and handled multiple cases of false invoice issuance in the petrochemical industry through this model, significantly improving the accuracy and deterrence of supervision.

In terms of the construction of local intelligent supervision platforms, various regions are actively exploring full-chain and penetrating data supervision models. For example, in April 2025, Shangluo City, Shaanxi Province, jointly with 11 departments, built an intelligent supervision platform for refined oil gas stations. By installing intelligent monitoring, tax control collectors and other equipment, it conducts 24/7 monitoring of 91 social gas stations in the city, and introduces AI technology to analyze vehicle trajectories and inventory dynamics, which has promoted 20 enterprises to correct declarations and pay back taxes. As of June 2025, the declared sales volume of local gas stations has increased by 43.58% year-on-year. Chaoyang City, Liaoning Province, has built a cloud platform of "five-point data collection + AI cross-validation", installed intelligent equipment at key points of fuel dispensers, and connected with data from the public security "Skynet Project" , accurately identifying irregular behaviors such as off-the-books circulation and illegal sales of smuggled oil. In addition, similar digital supervision mechanisms have been implemented in Hancheng of Shaanxi, Linxia of Gansu, Linfen of Shanxi and other places, and related platform construction projects in Weinan, Shiyan and other cities are also in the bidding or implementation stage.

Looking forward to 2026, "governing tax through data" will become the core model of tax supervision in the petrochemical industry . With the continuous deepening of intelligent supervision, the technical space for tax-related illegal operations will be continuously compressed. For enterprises, it is necessary to actively adapt to the requirements of digital supervision: first, ensure the consistency and dynamic alignment of purchase, sales and inventory, invoices and declaration data throughout the process to avoid early warnings from the source; second, strengthen data security management capabilities, standardize the operation of tax digital accounts, and systematically investigate potential risks in data circulation.

04 Sustained Intensity of Joint Crackdowns, Continuous Strengthening of Cross-departmental Governance Pattern

The normalized crackdown mechanism formed by tax authorities in conjunction with public security, procuratorial, customs, market supervision and other departments is constantly improving. In 2026, the crackdown on tax-related crimes will remain in a high-pressure posture. In December 2025, Hu Jinglin, Director of the State Taxation Administration, clearly stated that it is necessary to further implement the "Foundation-Strengthening Project" and increase the intensity of investigation and punishment of tax-related violations. As a key regulatory area, the petrochemical industry will continue to face strict tax supervision, which may be dynamically adjusted according to the annual supervision priorities.

In local practice, cross-departmental joint crackdowns have achieved remarkable results. Tax authorities in Guangxi, together with eight departments including public security, courts, procuratorates, and the People's Bank of China, have continuously improved the normalized joint crackdown mechanism and promoted the "Joint Sword 2025" campaign. As of the end of October 2025, more than 1,300 enterprises suspected of false invoicing and tax fraud have been filed for inspection, involving nearly 80,000 false invoices with a total price and tax of about 20 billion yuan. In the refined oil field, multiple departments have jointly carried out special rectification, filed inspections against more than 100 high-risk gas stations, recovered a total of more than 100 million yuan, and publicly exposed 2 typical cases.

In addition, cross-departmental collaboration is extending towards data sharing and business penetration. For example, the Hunan Provincial Taxation Bureau signed a strategic cooperation agreement with the Department of Transportation, promoting the interconnection of data such as road transportation, electronic waybills, and invoice information, verifying the authenticity of refined oil businesses through logistics trajectories, and gradually realizing full-chain penetrating supervision. In the petrochemical industry, electronic transportation trajectories can provide important evidence for the true flow of goods, helping to verify the authenticity of businesses from the logistics link, which is worthy of enterprises' attention.

In 2026, the pattern of cross-departmental joint crackdowns and collaborative governance will be further consolidated. Its core lies in breaking the information barriers between departments, realizing closed-loop management of data sharing, clue transfer, and joint investigation and punishment, especially the precise crackdown on cross-link violations such as false invoicing and tax evasion. From the perspective of trends, the scope of joint crackdowns extends from terminal retail to the upstream and downstream of the industrial chain, covering the full chain of production, transportation, equipment modification, software services, etc., and the crackdown method shifts from "campaign-style rectification" to "normalized supervision". For enterprises, it is necessary to strictly examine the qualifications of upstream and downstream partners in business cooperation, standardize the management of vouchers such as contracts, invoices, and logistics, and avoid being implicated due to violations of associated parties.

05 Gas Stations Become the Focus of Rectification, Tax-Related Risks Spread to the Entire Chain

As the terminal of refined oil retail, tax evasion by gas stations is one of the key points of tax supervision. Investigation data in 2025 shows that the high-pressure supervision posture continues. The State Taxation Administration disclosed at a press conference that from January to November 2025, a total of 3,904 high-risk gas stations were inspected nationwide, with 4.163 billion yuan of taxes recovered. Compared with previous years, 2,722 gas stations were inspected throughout 2024, with a total of 5.789 billion yuan of taxes, late fees and fines recovered; during the comprehensive governance in 2023, 609 gas stations that cheated through fuel dispensers were inspected, involving 1.961 billion yuan of taxes, late fees and fines. Although the current amount of recovered taxes fluctuates compared with the same period last year, the intensity of rectification usually increases at the end of the year, and the full-year data is expected to rise. Overall, with the continuous deepening of supervision, the number of exposed tax-related violations and the scale of cases are expected to further expand in 2026.

From the perspective of illegal methods, tax evasion behaviors show the characteristics of high technicalization and organizational chain. In January 2025, CCTV exposed 95 cases of tax evasion by gas stations, involving 790 million yuan; in November of the same year, "Focus Interview" once again revealed that some gas stations installed cheating software to simultaneously manipulate fuel dispensers to steal oil and falsify declaration data. For example, a gas station had an actual sales volume of 8.5 million yuan in July but only declared 770,000 yuan, evading nearly 8 million yuan in taxes. Such cheating behaviors have developed into a black industrial chain covering software development, equipment modification, and operation and maintenance. In May 2025, the police cracked a national cheating software case. The criminal gang colluded with manufacturers to leave backdoors in the metering systems of fuel dispensers and sold more than 360 sets of cheating software to 21 provinces and cities. At present, various types of cheating software are still being continuously iterated to avoid regulatory testing.

In addition, judicial supervision has also intervened. In November 2025, among the typical cases handled by the public interest litigation big data legal supervision model released by the Supreme People's Procuratorate, the "administrative public interest litigation case of the People's Procuratorate of Jiaozhou City, Shandong Province, supervising the rectification of value-added tax evasion on refined oil products" attracted attention. Targeting illegal acts such as concealing income and evading value-added tax on refined oil products through the "no-invoice refueling" sales model in the refueling industry, procuratorial organs used the big data legal supervision model to accurately compare the differences between tax payable and tax actually paid, and lock in clues to public interest litigation cases of tax evasion. The People's Procuratorate of Jiaozhou City obtained basic information of independently accounted gas stations in the jurisdiction from market supervision departments; retrieved transaction flows from financial institutions, and through setting keywords such as "oil", "payment for goods", and "purchase", combined with transaction time and amount fluctuation rules, accurately screened effective data highly related to refined oil sales, restored the true sales trajectory, and accurately calculated the tax payable. On this basis, the procuratorial organ issued procuratorial suggestions to the tax authority, urging the tax authority to promptly investigate and rectify problems, collect taxes and late fees in accordance with the law, and do a good job in source prevention and control.

It can be seen that not only the tax system is actively building intelligent tax control platforms, but also procuratorial organs are taking the initiative to intervene with big data supervision models, further compressing the operational space for gas stations to evade taxes through "off-invoice sales". Looking forward to 2026, tax supervision in the gas station field will continue to maintain a high-pressure posture, with unrelenting rectification intensity, expanded coverage, and continuous upgrading of supervision methods. In this context, gas stations must focus on preventing risks such as technical cheating and off-invoice sales, take the initiative to connect to intelligent supervision platforms, and effectively ensure the authenticity of business data, accuracy of declarations, and tax compliance.

06 Consumption Tax Reform is Expected to Be Implemented, Industry Interest Pattern Faces Restructuring

The reform of shifting the collection link of refined oil consumption tax has entered an accelerated phase. The Third Plenary Session of the 20th Central Committee of the Communist Party of China clearly proposed "promoting the shift of the consumption tax collection link and steadily delegating it to local governments" in 2024. The 2025 Government Work Report further emphasized the need to "accelerate the shift of the collection link of consumption tax for some items and steadily delegate it to local governments to increase local independent financial resources", releasing a signal that the reform is about to be implemented. As China's third-largest tax category, more than 90% of consumption tax revenue comes from four major items: tobacco, alcohol, refined oil, and automobiles. As a core item, the reform of refined oil will have a profound impact on the industry.

The core of this reform is the "shift of the collection link" and "delegation of revenue to local governments". The so-called "shift" refers to the gradual adjustment of consumption tax collection from the current production link to the wholesale or retail link. "Delegation" means that the tax revenue belongs to the local government where the consumption occurs. Taking the sales of gasoline from Shandong refineries to Hebei gas stations as an example, after the reform, the consumption tax will be declared and paid by Hebei gas stations to the local tax authority. From the perspective of implementation conditions, the national unified refined oil invoice issuance module, the widely used gas station tax control system, and the full-chain regulatory policies introduced by multiple departments since 2025 have provided a solid technical and institutional foundation for the reform.

The reform will have an impact on various subjects. For refining and chemical enterprises, no longer bearing the consumption tax at the ex-factory link will help alleviate the pressure of capital occupation and improve cash flow. For local governments in traditional refining and chemical industry clusters, they may face the challenge of tax source loss. For wholesale and retail enterprises, becoming direct taxpayers of consumption tax will increase compliance management costs, but it will help create a more fair competitive environment. For local governments in consumption areas, the clear ownership of tax sources will further enhance their enthusiasm for tax supervision.

2026 is expected to be a key year for the implementation of the refined oil consumption tax reform. This reform is not only an adjustment of the tax collection and administration link but also a restructuring of the industry interest pattern. For enterprises, it is necessary to make preparations in advance: first, refining and chemical enterprises should evaluate the operational adjustment space brought by the improvement of cash flow and pay attention to changes in the price transmission mechanism in the downstream link; second, wholesale and retail enterprises should establish a consumption tax declaration and compliance management system and calculate cost pressure in advance; third, enterprises across the industry should closely track the reform details, especially key contents such as the definition of collection links, tax rate adjustments, and transition period arrangements, and actively adapt to policy changes.

07 Clarification of Judicial Adjudication Rules, More Precise Definition of Tax-Related Crimes

On November 24, 2025, the Supreme People's Court released eight typical cases of punishing crimes endangering tax collection and administration in accordance with the law. Among them, the "Tax Evasion Case of Guo and Liu" further clarified the distinction rules between the crime of falsely issuing special VAT invoices and the crime of tax evasion. The court pointed out in the case that "the key to distinguishing between the crime of falsely issuing special VAT invoices and the crime of tax evasion lies in whether the actor subjectively intends to defraud national tax revenue or evade tax obligations. If a taxpayer with tax obligations commits a crime by falsely increasing input tax for deduction to pay less tax within the scope of tax obligations, even if the means of false issuance and deduction are adopted, the subjective purpose is to avoid paying or pay less tax. In accordance with the principle of unifying subjectivity and objectivity, it shall be convicted and punished as the crime of tax evasion".

This judicial adjudication rule has essentially formed a "reverse misdemeanor presumption", that is, if the amount of tax falsely deducted by an enterprise does not exceed the annual tax obligation scope, it is presumed that the subjective purpose is to evade tax obligations rather than defraud national VAT. This has an important impact on criminal defense in tax-related cases in the petrochemical industry. Even if an entity enterprise has flaws such as inconsistency between invoice flow and goods flow and fund return in transactions, as long as the amount of falsely deducted input tax does not exceed the annual tax obligation scope, it will be convicted and punished as the crime of tax evasion rather than the crime of falsely issuing special VAT invoices. At the same time, the difference in conviction directly affects the criminal prosecution limitation period. The maximum penalty for the crime of falsely issuing special VAT invoices is life imprisonment with a prosecution limitation period of 20 years, while the maximum penalty for the crime of tax evasion is 7 years of imprisonment with a prosecution limitation period of only 10 years. This means that if the act of falsely deducting input tax occurred more than ten years ago, it may no longer be subject to criminal liability due to the expiration of the prosecution limitation period if convicted as the crime of tax evasion. It is expected that in 2026, this judicial adjudication rule will be more widely applied in judicial practice, helping to cultivate tax sources and avoid imposing heavy penalties for minor offenses on entity enterprises.

Conclusion: In the new tax supervision ecosystem, it is difficult for enterprises to resist systematic compliance risks only by passive response. Therefore, enterprises must take the initiative to change their thinking and deeply integrate tax compliance into the entire business process. Firstly, anticipate policy trends, closely follow the progress of major reforms such as the shift of the consumption tax collection link, and conduct advance research and judgment on impacts and layout responses. Secondly, consolidate the data foundation, ensure the consistency of business data, financial data and tax data, standardized processes and complete vouchers, and truly adapt to the supervision requirements of "governing tax through data". Thirdly, strictly control cooperation risks, carefully evaluate the qualifications of upstream and downstream partners, and prevent chain risks caused by violations of associated parties. Fourthly, make good use of professional support, take the initiative to rely on professional forces such as legal and tax experts in complex tax-related disputes, and strive for favorable results based on clear judicial rules.