China increases taxes on select telecoms services to boost finances

China increased taxes on select telecoms services, impacting mobile data, SMS, and broadband. This move follows a sharp drop in fiscal revenue in late 2025. The tax adjustment reclassifies these services from a 6% to a 9% value-added tax rate, aligning with their status as essential digital infrastructure. Economists view this as a targeted measure, not a signal for broader tax increases across the private sector, which they believe would be counterproductive.