ECONOMY

Widespread Abuse Found in China’s Consumer Goods Subsidies

Published: Aug. 7, 2025 7:57 p.m. GMT+8

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Local audits across China have uncovered widespread misuse of government subsidies designed to boost consumer spending. Photo: AI generated

Local audits across China have uncovered widespread misuse of government subsidies designed to spur consumption, with millions of yuan improperly claimed.

As of Wednesday, 10 of the Chinese mainland’s 31 provincial-level regions have released their annual reports on how public funds were spent in the previous year, including on the consumer goods trade-in program.

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Local audits in 10 Chinese provinces found millions of yuan in government consumption subsidies improperly claimed by retailers and individuals.
Common abuses include falsifying transactions, price manipulation, and misusing personal information to bypass subsidy limits; one Beijing case involved fraudulent purchases totaling 247 million yuan ($34.4 million).
The consumer goods trade-in program, supported by 300 billion yuan in 2024, faces widespread misuse, with documented fraudulent claims across multiple regions.

AI generated, for reference only

What Happened When

Last year (2024)：: Around 6.7 million yuan in subsidies was improperly claimed in Beijing, with invoices listing companies or institutions as buyers.

Last year (2024)：: The government trade-in program expanded with increased subsidies and more eligible products.

This year (2025)：: A total of 300 billion yuan in ultra-long special treasury bonds was designated to support the trade-in program, double the previous year’s allocation.

June 2025：: The State Council released a report exposing misuse of trade-in subsidies, including 1.7 million yuan fraudulently claimed by five firms in Yunnan province.

July 2025：: The Beijing city audit report was published, detailing subsidy abuse and improper claims in 2024.

As of Wednesday, 2025：: 10 of the Chinese mainland’s 31 provincial-level regions released their annual reports on 2024 public fund spending, including the consumer goods trade-in program.

AI generated, for reference only