China Introduces Mandatory Real-Time Fiscalization for Fuel Retailers

China has introduced mandatory transaction-based e-invoicing for fuel retailers from November 1, 2026. Through the LeQi platform, fuel sales must generate digital invoices linked to transaction data, strengthening real-time tax monitoring and requiring POS system integration.

China moves toward transaction-based fiscalization.

China has taken an important step toward expanding online fiscalization by introducing mandatory transaction-based electronic invoicing for fuel retailers nationwide. Since November 1, 2026, covered fuel retailers must automatically generate digital tax invoices linked to completed fuel sales, using the LeQi platform.

The development strengthens the connection between retail transactions, payment systems, and China's electronic invoicing infrastructure. It also represents an important change for retailers, POS providers and fiscal software developers operating in the Chinese market.

How does China's fiscalization system work?

China operates a digital tax-control system primarily based on electronic invoicing rather than traditional fiscal cash registers or fiscal printers.

The central element is the fapiao, an official tax invoice used for both B2B and B2C transactions. Unlike an ordinary POS receipt, which documents a customer's purchase, a fapiao is an official tax document regulated by Chinese tax legislation.

China's electronic invoicing system, known as e-fapiao, enables businesses to issue, deliver, and manage official invoices electronically.

On December 1, 2024, the State Taxation Administration (STA) introduced the nationwide application of fully digitalized electronic invoices under Announcement No. 11 of 2024.

These invoices contain standardized identification information and can be electronically verified through the national tax infrastructure.

However, this does not mean that every ordinary retail transaction automatically requires an official electronic invoice. In many retail situations, customers receive ordinary POS receipts, while a fapiao is issued upon request.

Mandatory transaction-based invoicing for fuel retailers

A significant regulatory development came with STA Announcement No. 11 of 2026, which introduced transaction-based invoicing requirements for covered refined-oil retailers.

The nationwide obligation took effect on November 1, 2026.

Under the new model, fuel retailers must issue fully digitalized electronic invoices based on actual sales transactions, connecting invoicing directly to the completion of qualifying fuel purchases.

Previously, customers often needed to request a fapiao separately after payment, provide their billing information, and wait for the invoice to be generated.

The new approach automates much of this process.

The requirements cover different payment scenarios, including mobile payments, bank cards, fuel cards, cash payments, and corporate transfers.

This development allows tax authorities to receive more accurate transaction-related invoice information and reduces discrepancies between payment records and officially issued invoices.

LeQi platform and POS system integration

The main technology supporting this development is LeQi, a digital platform established by China's State Taxation Administration.

LeQi connects enterprise information systems with the country's electronic invoicing infrastructure, allowing official invoices to be generated from business transaction data.

Fuel retailers can operate through two integration models:

• LeQi Self-Use: Eligible businesses connect their own information systems directly to the platform, subject to applicable conditions and tax authority confirmation.
• LeQi Shared-Use: Businesses use an eligible shared LeQi service platform to support electronic invoicing.

For retailers, the new requirements may involve integrating POS applications, fuel management software, payment systems, and invoicing services.

Transaction information, including products, quantities, prices, and relevant customer information, must be processed accurately to generate compliant invoices.

This makes software integration an important part of fiscal compliance.

What happens during a retail transaction?

Under transaction-based invoicing, the process begins when a customer completes a qualifying fuel purchase.

The retailer's systems capture the relevant transaction and payment information and transfer the required data through the applicable LeQi integration.

The system then generates the corresponding digital electronic invoice using the transaction information.

Customers can access their invoices electronically through supported digital channels.

For example, when customers pay for fuel using a mobile payment application, the integrated systems can link the payment to the transaction and initiate automatic invoice issuance.

This reduces manual invoicing procedures and strengthens the connection between sales records, payments, and tax documentation.

Are fiscal devices and POS certification required?

China's approach differs from fiscalization models that require certified fiscal printers, fiscal memory devices, or specialized fiscal cash registers.

The general electronic invoicing framework does not impose universal certification requirements for ordinary POS applications or dedicated fiscal hardware.

Retailers can use different software and hardware solutions, provided they comply with applicable tax and invoicing regulations.

For covered fuel retailers, however, the ability to integrate with LeQi and support transaction-based electronic invoicing is essential.

Consequently, compliance focuses increasingly on system connectivity, accurate transaction information, and the correct issuance of official electronic invoices.

Returns, corrections, and invoice cancellations

Chinese regulations also establish procedures for correcting previously issued electronic invoices.

When an invoice needs adjustment because of a return, cancellation, pricing error, or other correction, businesses generally follow the red-letter electronic invoice procedure.

Depending on the original invoice's status, additional confirmation procedures may be necessary.

Retailers must therefore ensure that refund and correction processes are properly connected with their electronic invoicing systems.

An ordinary POS refund receipt does not replace the required correction of an official fapiao.

What does this mean for China's retail sector?

The November 2026 requirements represent an important development in China's move toward automated transaction-level tax monitoring.

Although mandatory transaction-based invoicing currently focuses on the covered fuel retail sector, China has also tested automated invoicing processes in restaurants, supermarkets, parking facilities and other consumer-facing activities.

These pilot developments do not automatically create nationwide obligations for other retail sectors.

Nevertheless, the fuel-sector implementation demonstrates how China's electronic invoicing infrastructure can become more closely connected with everyday retail operations.

For international retailers and fiscal software providers, the development highlights the importance of monitoring future regulatory changes and preparing systems for additional electronic invoicing requirements.

How will China's new fiscalization requirements impact retailers and POS providers?

Mandatory transaction-based invoicing requires covered fuel retailers to integrate their sales and payment systems with LeQi and automate compliant electronic invoice issuance. Businesses should review their existing POS infrastructure, verify the applicable integration model, and ensure accurate transaction reporting, while other retailers should monitor potential future expansion to additional sectors.

Here you can find the announcement of the State Taxation Administration on matters concerning the full implementation of "transaction-based invoicing" in the retail sector of Refined Oil Products - Source

Ljubica Blagojević Junior Legal Research Specialist Linkedin profile