Recently, a factory owner sent us a private message: “I’ve heard that taxes will be imposed on VOCs, but I’m not clear on when it will start, how the tax will be levied, or whether it applies to me.”

This is real. And it’s happening faster than you think.

A new tax has already been enshrined in law.

In October 2025, the Standing Committee of the National People’s Congress adopted the Decision on Amending the Environmental Protection Tax Law, formally enshrining the pilot program for levying taxes on volatile organic compounds (VOCs) in law.

This is neither “policy in the works” nor a “draft for discussion.”

It already has a legal basis.

Over the past decade, China’s regulatory framework for VOCs has followed a sequential logic: emission standards → environmental inspection and enforcement → total-quantity control. The only missing link in this chain has been economic incentives.

We found that corrective action is required, which represents a one-time pressure.

Tax is a cost that accumulates with every production cycle.

Who feels the pressure first?

The answer is clear: factories that extensively use solvent-based coatings.

Let’s take a specific scenario:

A medium-sized steel structure fabrication company has an annual coating area of approximately 50,000 square meters and uses conventional solvent-based anti-corrosion coatings with a VOC content typically exceeding 400 g/L.

With the gradual implementation of the VOCs tax rate, preliminary industry estimates indicate that the additional annual tax burden solely from the coating process will, on the conservative side, amount to roughly RMB 100,000—this figure does not even include potential ancillary costs such as environmental fines, production shutdowns for rectification, and failure to pass green supply-chain audits.

The more pressing pressure comes from your downstream customers.

Green procurement requirements for large central and state-owned enterprises are undergoing systematic upgrades. An increasing number of project tender documents now require suppliers to provide VOC emission data, with some even explicitly stipulating “the use of water-based coatings” as a qualification criterion for shortlisting.

Your clients are watching this, too.

Waterborne Coatings: From “Eco-Friendly Option” to “Market Access Requirement”

Many factory owners view waterborne coatings as: a bit more expensive, slightly inferior in performance, and best avoided if possible.

This understanding needs to be updated in 2026.

Let’s look at performance first.

With the continuous advancement of formulation technologies, mainstream waterborne anti-corrosion coatings are now capable of meeting the corrosion protection requirements of most industrial applications. Taking Holy Hong’s Waterborne Ultra-Overbased Graphene Low-Zinc Coating For example, core performance indicators such as adhesion and weather resistance have already matched or even surpassed those of comparable solvent-based products—this is not just “good enough” in a makeshift sense; it truly delivers.

Now let’s look at the cost structure.

Now that the policy balance has shifted, the cost of continuing to use solvent-based coatings goes beyond just the fluctuating prices of raw materials—it is:

This spreadsheet is perfect for screenshotting and sharing with your manager or procurement lead.

Transformation is not an overnight process, but the window of opportunity is narrowing.

We do not recommend that factories overhaul all procurement decisions overnight.

Formulation testing, adjustments to construction processes, and supplier transitions all require a lead time.

However, one thing is certain: the earlier the assessment begins, the lower the transformation costs will be; waiting until the policy is fully implemented and then reacting passively will incur costs far exceeding the additional tax burden.

An action you can start right away:

Ask your paint supplier for a list: “Which of your products are low-VOC or water-based? Could you provide a comparative proposal?”

This single question is enough to determine whether your supplier has kept up with the times.

Like Companies like Holy Hong, which have been deeply engaged in the industrial anti-corrosion field for many years Even before this policy window opened, we had already systematically compiled VOC content data for our product portfolio, helping downstream customers assess their transition pathways and accurately calculate compliance costs in advance. This "Helping clients with their finances" Its service logic is increasingly becoming one of the core capabilities that enable industrial coatings companies to achieve differentiated competitiveness.

To be perfectly honest, in the end...

Compliance has never been merely "Risk avoidance" 。

At this critical juncture, manufacturers that proactively undertake the transition to waterborne coatings are not only securing tax-exempt status—they are also obtaining a golden ticket to access higher-tier customer segments.

Your competitors have already started doing the math.

If you would like to know whether the VOC content of the paint you are currently using exceeds the regulatory limit and approximately how much additional tax you would pay each year, please contact us. We will provide you with a free comparative assessment report.

Holy Hong Water-Based Paint | Industrial Anti-Corrosion: Let the Data Speak