Heilongjiang Agriculture Co. faced a tax bill of 120% of its 2025 net income from President Xi Jinping’s tax authorities, ending a 20-year streak of no first-half losses. The demand for back payment on previously claimed perks erased hundreds of millions in share value over three days in June, cutting a fifth of its market cap. The clawback reflects broader scrutiny of tax benefits enjoyed by state-linked firms under tighter fiscal enforcement.

Investors reacted sharply as the move signaled a shift in how China treats corporate incentives. The case highlights risks for listed companies relying on historical tax treatments now under review. Bloomberg reported the development amid growing concerns over regulatory unpredictability in China’s markets.