Di Yi Cai Jing·2026-02-01 13:42Core Viewpoint - The adjustment of the VAT tax rate applicable to telecommunications services in China will impact the revenue and profits of the three major telecom operators, China Mobile, China Unicom, and China Telecom, starting from January 1, 2026 [1][2]. Group 1: Tax Rate Changes - The new regulation changes the applicable tax category for mobile data services, SMS, MMS, and internet broadband access from value-added telecommunications services (6% VAT) to basic telecommunications services (9% VAT) [1][2]. - The definition of basic telecommunications services has been expanded to include mobile data services, SMS, MMS, and internet broadband access, which were previously classified under value-added telecommunications services [2]. Group 2: Financial Implications - The increase in VAT from 6% to 9% for certain services may lead to higher costs for consumers, although the extent of this price increase will depend on consumer demand elasticity [2][3]. - The adjustment is expected to increase the tax burden on telecom companies, but given their state-owned status and market position, the impact is considered manageable [2]. - The adjustment in tax rates is anticipated to contribute to increased fiscal revenue, addressing the growing fiscal pressure faced by the government [3]. Group 3: Broader Economic Context - In 2025, the national general public budget revenue is projected to be 21,604.5 billion yuan, a decrease of 1.7% from the previous year, while government fund budget revenue is expected to decline by 7% [3].