It Tech Packaging, Inc. ITP US Equity☆

Item 1A. RISK FACTORS 20

Item 1B. UNRESOLVED STAFF COMMENTS 37

Item 2. PROPERTIES 37

Item 3. LEGAL PROCEEDINGS 37

Item 4. MINE SAFETY DISCLOSURES 37

PART II

Item 6. [RESERVED] 38

Item 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK 50

Item 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA 50

Item 9A. CONTROLS AND PROCEDURES 51

Item 9B. OTHER INFORMATION 51

Item 9C. DISCLOSURE REGARDING FOREIGN JURISDICTIONS THAT PREVENT INSPECTION. 51

PART III

Item 10. DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE 52

Item 11. EXECUTIVE COMPENSATION 55

Item 14. PRINCIPAL ACCOUNTANT FEES AND SERVICES 58

PART IV

Item 15. EXHIBITS AND FINANCIAL STATEMENT SCHEDULES 59

SIGNATURES 63

i

INTRODUCTION

All

references to “we,” “us,” “our,” or similar terms used in this annual report refer to IT Tech Packaging,

Inc., a Nevada corporation, including its wholly-owned subsidiaries, and, in the context of describing our operations and consolidated

financial information, our variable interest entity in China, Hebei Baoding Dongfang Paper Milling Company Limited, or Dongfang Paper.

“IT Tech Packaging” refers to IT Tech Packaging, Inc. “VIE” or “Dongfang Paper” refers to our variable

interest entity in China. “BaodingShengde” or “PRC Subsidiary” refers to our PRC subsidiary, Baoding Shengde

Paper Co., Ltd, a PRC company.

All

references to “PRC” or “China” refers to the People’s Republic of China, excluding, for the purpose of

this annual report, Taiwan, Hong Kong and Macau; all references to “RMB” or “Renminbi” refer to the legal currency

of China; all references to “US$,” “dollars,” “U.S. dollars” and “$” refer to the legal

currency of the United States.

This

annual report on Form 10-K includes our audited consolidated statements of income and comprehensive income and our audited consolidated

balance sheets as of December 31, 2021 and 2020.

FORWARD

LOOKING STATEMENTS

This

Annual Report on Form 10-K contains “forward-looking statements.” These statements are made under the “safe harbor”

provisions of the U.S. Private Securities Litigation Reform Act of 1995. You can identify these forward-looking statements by terms such

as “may,” “will,” “expects,” “anticipates,” “future,” “intend,”

“plan,” “believe,” “estimate,” “is/are likely to” and similar expressions. These statements

involve known and unknown risks, uncertainties and other factors that may cause our actual results, performance or achievements to be

materially different from those expressed or implied by the forward-looking statements. Factors that could cause or contribute to such

differences in results and outcomes include, without limitation, COVID-19 outbreak, our anticipated revenues from the corrugating medium

paper business segment and offset printing paper business, our ability to implement the planned capacity expansion of tissue paper, our

ability to introduce new products, market acceptance of new products, general economic and business conditions, the ability to attract

or retain qualified senior management personnel and research and development staff, and those specifically addressed under the headings

“Risks Factors” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations.”

The forward-looking statements made in this annual report relate only to events as of the date on which the statements are made. We undertake

no obligation, beyond any than as required by law, to update any forward-looking statement to reflect events or circumstances after the

date on which the statement is made, even though our situation changes in the future.

We

operate in an emerging and evolving environment. New risk factors emerge from time to time and it is impossible for our management to

predict all risk factors, nor can we assess the impact of all factors on our business or the extent to which any factor, or combination

of factors, may cause actual results to differ materially from those contained in any forward-looking statement.

ii

PART

I

Item

1. Business

IT Tech Packaging, Inc. (the

“Company” or “IT Tech Packaging”) is not an operating company but a Nevada holding company with operations primarily

conducted by its subsidiary and variable interest entity, or VIE. We operated our business in China through our PRC subsidiary, Baoding

Shengde Paper Co., Ltd. ( the “PRC Subsidiary” or “Baoding Shengde”) and Hebei Baoding Dongfang Paper Milling

Company Limited (“Dongfang Paper”), which we refer to as our VIE in this annual report, and rely on contractual arrangements

among our PRC subsidiary, the VIE and VIE’s shareholders to operate our business in China. Investors in our common stock should

be aware that they may never directly hold equity interests in the Chinese operating entities, but rather purchasing equity solely in

IT Tech Packaging Inc., our Nevada holding company, which does not directly own substantially all of our business in China conducted by

our PRC Subsidiary and VIE.

Because

of our corporate structure, we as well as the investors are subject to unique risks due to uncertainty of the interpretation and the

application of the PRC laws and regulations, including but not limited to regulatory review of oversea listing of PRC companies through

a special purpose vehicle. We are also subject to the risks of uncertainty about any future actions of the PRC government in this regard.

We may also be subject to sanctions imposed by PRC regulatory agencies including Chinese Securities Regulatory Commission (“CSRC”)

if we fail to comply with their rules and regulations. Although the Company is currently not required to obtain permission from any of

the PRC central or local government to obtain such permission and has not received any denial to list on the U.S. exchange, our operations

could be adversely affected, directly or indirectly, by existing or future laws and regulations relating to its business or industry,

if we inadvertently conclude that such approvals are not required when they are, or applicable laws, regulations, or interpretations

change and we are required to obtain approval in the future. For a description of relevant risks related to our corporate structure,

see “Risk Factors – Risks Relating to Doing Business in China” and “Risk Factors – Risks Relating to

Our Corporate Structure.”

Corporate

History

IT Tech Packaging was incorporated

in the State of Nevada on December 9, 2005, under the name “Carlateral, Inc.” Through the steps described below, we became

the holding company with operations primarily conducted by our subsidiaries and our VIE, Dongfang Paper, a producer and distributor of

paper products in China, on October 29, 2007. Effective on August 1, 2018, we changed our corporate name to IT Tech Packaging, Inc. The

name change was effected through a parent/subsidiary short-form merger of IT Tech Packaging, Inc., our wholly-owned Nevada subsidiary

formed solely for the purpose of the name change, with and into us. We were the surviving entity. In connection with the name change,

our common stock began being traded under a new NYSE symbol, “ITP,” at such time.

On

October 29, 2007, pursuant to an agreement and plan of merger (the “Merger Agreement”), the Company acquired Dongfang

Zhiye Holding Limited (“Dongfang Holding”), a corporation formed on November 13, 2006 under the laws of the British

Virgin Islands, and issued the shareholders of Dongfang Holding an aggregate of 7,450,497 (as adjusted for a four-for-one reverse

stock split effected in November 2009) shares of our common stock, which shares were distributed pro-rata to the shareholders of

Dongfang Holding in accordance with their respective ownership interests in Dongfang Holding. At the time of the Merger Agreement,

Dongfang Holding owned all of the issued and outstanding stock and ownership of Dongfang Paper and such shares of Dongfang Paper

were held in trust with Zhenyong Liu, Xiaodong Liu and Shuangxi Zhao, for Mr. Liu, Mr. Liu and Mr. Zhao (the original shareholders

of Dongfang Paper) to exercise control over the disposition of Dongfang Holding’s shares in Dongfang Paper on Dongfang

Holding’s behalf until Dongfang Holding successfully completed the change in registration of Dongfang Paper’s capital

with the relevant PRC Administration of Industry and Commerce as the 100% owner of Dongfang Paper’s shares. As a result of the

merger transaction, Dongfang Holding became a wholly owned subsidiary of the Company, and Dongfang Holding’s wholly owned

subsidiary, Dongfang Paper, became an indirectly owned subsidiary of the Company.

Dongfang

Holding, as the 100% owner of Dongfang Paper, was unable to complete the registration of Dongfang Paper’s capital under its name

within the proper time limits set forth under PRC law. In connection with the consummation of the restructuring transactions described

below, Dongfang Holding directed the trustees to return the shares of Dongfang Paper to their original shareholders, and the original

Dongfang Paper shareholders entered into certain agreements with Baoding Shengde Paper Co., Ltd. (“Baoding Shengde”) to transfer

the control of Dongfang Paper over to Baoding Shengde.

On

June 24, 2009, the Company consummated a number of restructuring transactions pursuant to which it acquired all of the issued and outstanding

shares of Shengde Holdings Inc., a Nevada corporation. Shengde Holdings Inc. was incorporated in the State of Nevada on February 25,

2009, and holds a wholly-owned subsidiary, Baoding Shengde, a limited liability company organized under the laws of the PRC on June 1,

2009. Because Baoding Shengde is a wholly-owned subsidiary of Shengde Holdings Inc., it is regarded as a wholly foreign-owned entity

under PRC law.

Effective

June 24, 2009, Baoding Shengde, Dongfang Paper and the original shareholders of Dongfang Paper entered into a number of contractual arrangements,

as subsequently amended on February 10, 2010, pursuant to which Baoding Shengde acts as the management company for Dongfang Paper, and

Dongfang Paper conducts the principal operations of the business. The contractual arrangements, as amended, effectively transferred the

preponderance of the economic benefits of Dongfang Paper to Baoding Shengde, and as a result, Baoding Shengde assumed effective control

and management over, is considered the primary beneficiary of Dongfang Paper for accounting purposes and we consolidate Dongfang Paper’s

operating results in IT Tech Packaging’s financial statements under U.S. GAAP. The contractual arrangements, as amended, include

the following:

(i) Exclusive Technical Service and Business Consulting Agreement

The

exclusive technical service and business consulting agreement, entered into by and between Baoding Shengde and Dongfang Paper, provides

that Baoding Shengde shall provide exclusive technical, business and management consulting services to Dongfang Paper, in exchange for

service fees including a fee equivalent to 80% of Dongfang Paper’s total annual net profits. The agreement is terminable upon mutual

written agreement.

1

(ii) Call Option Agreement

The

call option agreement, entered into by and between Baoding Shengde, Dongfang Paper and the shareholders of Dongfang Paper, provides that

the shareholders of Dongfang Paper irrevocably grant to Baoding Shengde an option to purchase all or part of each shareholder’s

equity interest in Dongfang Paper. The exercise price for the options shall be RMB yuan for each of the shareholders’ equity interests,

or if at any time there are PRC laws regulating the minimum exercise price of such options, then to the extent permitted under PRC Law.

The call option agreement contains covenants from Dongfang Paper and its shareholders that they will refrain from taking certain actions

without Baoding Shengde’s consent that would materially affect Dongfang Paper’s operations and asset value, including (i)

supplementing or amending its articles of association or bylaws, (ii) changing Dongfang Paper’s registered capital or shareholding

structure, (iii) selling, transferring, mortgaging or disposing of any interests in Dongfang Paper’s assets or income, or encumbering

Dongfang Paper’s assets or income in a way that would approve a security interest on such assets, (iv) incurring or guaranteeing

any debts not incurred in its normal business operations, (v) entering into any material contract or urging Dongfang Paper management

to dispose of any Dongfang Paper assets, unless it is within the company’s normal business operations; (vi) providing any loan

or guarantee to any third party; (vii) appointing or removing any management personnel or directors that can be changed upon Dongfang

Paper shareholder approval; (viii) declaring or distributing any dividends to the stockholders. The agreement remains effective until

Baoding Shengde or its designees have acquired 100% of the equity interests of Dongfang Paper underlying the options.

(iii) Share Pledge Agreement

The

share pledge agreement entered into by and between Baoding Shengde, Dongfang Paper and the shareholders of Dongfang Paper, provides that

the Dongfang Paper shareholders will pledge all of their equity interests in Dongfang Paper to Baoding Shengde as security for their

obligations under the other management agreements described in this section. Specifically, Baoding Shengde is entitled to dispose of

the pledged equity interests in the event that the Dongfang Paper shareholders or Dongfang Paper fails to pay the service fees to Baoding

Shengde pursuant to the exclusive technical service and business consulting agreement or fails to perform their other obligations under

the other management agreement. The agreement contains covenants from Dongfang Paper’s shareholders that they will refrain from

taking certain actions without Baoding Shengde’s prior written consent, such as transferring or assigning their equity interests,

or creating or permitting the creation of any pledges which may have an adverse effect on the rights or benefits of Baoding Shengde under

the agreement. The Dongfang Paper shareholders also promise to comply with the laws and regulations relevant to the pledges under the

agreement and to facilitate in good faith the protection of the ability of Baoding Shengde to exercise its rights under the agreement.

The terms of the share pledge agreement remains in effect until all the obligations under the other management agreements have been fulfilled,

whether or not the terms of the other management agreements have expired.

(iv) Proxy Agreement

The

proxy agreement, entered into by and between Baoding Shengde, Dongfang Paper and the shareholders of Dongfang Paper, provides that the

Dongfang Paper shareholders shall irrevocably entrust a designee of Baoding Shengde with such shareholder’s voting rights and the

right to represent such shareholder to exercise his or her rights at any shareholder’s meeting of Dongfang Paper or with respect

to any shareholder action to be taken in accordance with the laws and Dongfang Paper’s Articles of Association. The terms of the

agreement are binding on the parties for as long as the Dongfang Paper shareholders continue to hold any equity interest in Dongfang

Paper. AnDongfang Paper shareholder will cease to be a party to the agreement once it transfers its equity interests with the prior approval

of Baoding Shengde.

On

June 24, 2009, Zhao Tianqing, the sole shareholder of Shengde Holdings Inc., assigned to the Company, for good and valuable consideration,

100 shares representing 100% of the issued and outstanding shares of Shengde Holdings Inc. As a result of this assignment and the restructuring

transactions described above, Shengde Holdings Inc., Baoding Shengde, and Dongfang Paper became directly and indirectly controlled by

the Company, and Dongfang Paper continued to function as the Company’s operating entity.

2

In

addition to controlling the operations and beneficial ownership of Dongfang Paper, Baoding Shengde also acquired a digital photo paper

production line (including two photo paper coating lines and ancillary equipment) in an asset acquisition transaction on November 25,

2009 and began directly conducting business in the PRC. We suspended production of photo paper in June 2016 and now are upgrading the

production line to produce more competitive photo paper products.

An

agreement was entered into among Baoding Shengde, Dongfang Paper and the shareholders of Dongfang Paper on December 31, 2010, reiterating

that Baoding Shengde is entitled to the distributable profit of Dongfang Paper, pursuant to the above mentioned Exclusive Technical Service

and Business Consulting Agreement. In addition, Dongfang Paper and the shareholders of Dongfang Paper agreed that they would not declare

any of Dongfang Paper’s unappropriated earnings, including any earnings of Dongfang Paper from its establishment to 2010 and thereafter,

as dividend.

Controlled by contractual arrangements

3

Recent

Regulatory Developments

On January 4, 2022, the Cyberspace

Administration of China, or CAC, issued the revised Measures on Cyberspace Security Review (the “Revised Measures”), which

has came into effect on February 15, 2022. Under the Revised Measures, any “network platform operator” controlling personal

information of no less than one million users which seeks to list in a foreign stock exchange should also be subject to cyber security

review.

We do not believe we are “network

platform operator” who control over one million personal information as mentioned above; as such, we believe we are currently not

be subject to the cyber security review by the CAC. However, the definition of “network platform operator” is unclear

and it is also unclear on how it will be interpreted and implemented by the relevant PRC governmental authorities. See “Risk

factors — Risk Factors Relating to Doing Business in China — Our business may be subject to a variety

of PRC laws and other obligations regarding cyber security and data protection.”

On July 6, 2021, the

relevant PRC governmental authorities made public the Opinions on Strictly Cracking Down Illegal Securities Activities in Accordance with

the Law. These opinions emphasized the need to strengthen the administration over illegal securities activities and the supervision on

overseas listings by China-based companies and proposed to take effective measures, such as promoting the construction of relevant regulatory

systems to deal with the risks and incidents faced by China-based overseas-listed companies. As these opinions are recently issued, official

guidance and related implementation rules have not been issued yet and the interpretation of these opinions remains unclear at this stage.

See “Risk Factors — Risk Factors Relating to Doing Business in China — While the approval and/or

other requirements of the CSRC or other PRC governmental authorities are currently not required, they may be required, in connection with

our oversea listing under PRC rules, regulations or policies, and, if required, we cannot predict whether or how soon we will be able

to obtain such approval.” As of the date of this annual report, we have not received any inquiry, notice, warning, or sanctions

regarding listing abroad or offshore offering from the CSRC or any other PRC governmental authorities.

We

believe that we are currently not required to obtain any permission or approval from the China Securities Regulatory Commission (“CSRC”)

and Cyberspace Administration of China (“CAC”) in the PRC to issue securities to foreign investors. However, there is no

guarantee that this will continue to be the case in the future in relation to any future offerings of our company or the continued listing

of our company’s securities on the NYSE American, or even in the event such permission or approval is required and obtained, it

will not be subsequently revoked or rescinded. If we do not receive or maintain the approvals, or we inadvertently conclude that such

approvals are not required, or applicable laws, regulations, or interpretations change such that we are required to obtain approval in

the future, we may be subject to an investigation by competent regulators, fines or penalties, or an order prohibiting us from conducting

an offering, and these risks could result in a material adverse change in our operations and the value of our securities, significantly

limit or completely hinder our ability to offer or continue to offer securities to investors, or cause such securities to significantly

decline in value or become worthless.

On

December 24, 2021, CSRC issued Provisions of the State Council on the Administration of Overseas Securities Offering and Listing by Domestic

Companies (Draft for Comments) (the “Administration Provisions”), and the Administrative Measures for the Filing of Overseas

Securities Offering and Listing by Domestic Companies (the “Measures”), which are open for public comments by January 23,

2022. The Administration Provisions and Measures for overseas listings lay out specific requirements for filing documents and include

unified regulation management, strengthening regulatory coordination, and cross-border regulatory cooperation. Domestic companies seeking

to list abroad must carry out relevant security screening procedures if their businesses involve supervisions such as foreign investment

security and cyber security reviews. Companies endangering national security are among those off-limits for overseas listings. According

to Relevant Officials of the CSRC Answered Reporter Questions (“CSRC Answers”), after the Administration Provisions and Measures

are implemented upon completion of public consultation and due legislative procedures, the CSRC will formulate and issue guidance for

filing procedures to further specify the details of filing administration and ensure that market entities could refer to clear guidelines

for filing, which means it will still take time to put the Administration Provisions and Measures into effect. As the Administration

Provisions and Measures have not yet come into effect, we are currently unaffected by them. However, according to CSRC Answers, only

new initial public offerings and refinancing by existing overseas listed Chinese companies will be required to go through the filing

process; other existing overseas listed companies will be allowed a sufficient transition period to complete their filing procedure.

However, it is uncertain when the Administration Provision and the Measures will take effect or if they will take effect as currently

drafted.

On December 24, 2021, the

Standing Committee of the National People’s Congress issued Law of the People’s Republic of China on the Prevention and Control

of Noise Pollution(the “Prevention and Control of Noise Pollution”), which will be effected on June 5, 2022. According to

the Prevention and Control of Noise Pollution, entities subject to pollutant discharge licensing management shall not emit industrial

noise without a pollutant discharge permit and shall prevent and control noise pollution according to the requirements of the pollutant

discharge permit.

4

Consolidation

We conduct substantially all

of our business in China through Dongfang Paper, the VIE, due to PRC legal restrictions of foreign ownership in certain sectors. Substantially

all of IT Tech Packaging’s revenues, costs and net income in China are directly or indirectly generated through the VIE. IT Tech

Packaging, through its PRC Subsidiary, Baoding Shengde, has signed various agreements with the VIE and shareholders of the VIE to allow

the transfer of economic benefits from the VIE to the PRC Subsidiary and to direct the activities of the VIE.

Total assets and liabilities

presented on IT Tech Packaging’s consolidated balance sheets and revenue, expense, net income presented on consolidated statement

of operations and comprehensive income as well as the cash flow from operating, investing and financing activities presented on the consolidated

statement of cash flows are substantially the financial position, operation and cash flow of the VIE. The Company has not provided any

financial support to the VIE for the fiscal years ended at December 31, 2020 and 2019. As of December 31, 2021, our variable interest

entity accounted for an aggregate of 84.13% and 69.51%of our total assets and total liabilities. As of December 31, 2020, our variable

interest entity accounted for an aggregate of 90.7% and 72.4%of our total assets and total liabilities. As of December 31, 2021 and 2020,

$1,921,407 and $3,315,778 of cash and cash equivalents were denominated in RMB, respectively.

IT

Tech Packaging and its directly owned subsidiary, Shengde Holding do not have any substantial assets or liabilities or result of operations.

The following table sets forth the assets, liabilities, results of operations and changes in cash, cash equivalents of the VIE, which

were included in the Company’s consolidated balance sheets and statements of comprehensive income and statements of cash flows

with intercompany transactions eliminated:

As of

December 31, December 31,

For the Fiscal Year Ended December 31,

Net cash used in financing activities $ (917,041 ) $ (218,505 )

5

Cash

Transfers and Dividend Distribution

IT Tech Packaging

conducts its business operations in China through its Baoding Shengde, or the PRC Subsidiary and Dongfang Paper, the VIE. If needed,

IT Tech Packaging can transfer cash to the PRC Subsidiary through loans and/or capital contributions, and the PRC Subsidiary can

transfer cash to IT Tech Packaging through issuing dividends or other distributions. The PRC Subsidiary can transfer cash to the VIE

through intercompany loans and capital contributions, and the VIE can transfer cash to the PRC Subsidiary as services fees under the

VIE contractual arrangements. For the year ended December 31, 2021, the cash flows occurred between IT Tech Packaging, its

subsidiaries and the VIE included i) funding through Shengde Holdings Inc. to Baoding Shengde, with an amount of $32,052,000 as

capital contributions ii) Baoding Shengde payments to Heibei Tengsheng of $2,027,701 for purchase of products iii) Baoding Shengde loans to Dongfang Paper with

total amount of $19,345,101 and iv) Dongfang Paper payments to Baoding Shengde of $5,016,446 for purchase of raw materials.

Current PRC regulations permit

the PRC Subsidiary to pay dividends to its shareholders only out of their accumulated profits, if any, determined in accordance with PRC

accounting standards and regulations. The PRC Subsidiary is required to set aside 10% of its after-tax profits to fund a statutory reserve

until such reserve reaches 50% of its registered capital if it distributes its after-tax profits for the current financial year. For details,

see “Risk Factors — Risk Factors Relating to Doing Business in China — We may rely on dividends

and other distributions on equity paid by our PRC subsidiary to fund any cash and financing requirements we may have, and any limitation

on the ability of our PRC Subsidiary to make payments to us could have a material and adverse effect on our ability to conduct our business.”

In addition, cash transfers from IT Tech Packaging are subject to applicable PRC laws and regulations on loans and direct investment.

For details, see “Risk Factors — Risk Factors Relating to Doing Business in China — PRC regulation

of loans to and direct investment in PRC entities by offshore holding companies and governmental control of currency conversion may delay

us from making loans or additional capital contributions to our PRC Subsidiary, which could materially and adversely affect our liquidity

and our ability to fund and expand our business.”

In addition, the PRC government

imposes controls on the convertibility of the Renminbi into foreign currencies and, in certain cases, the remittance of currency out of

China. IT Tech Packaging receives a significant portion of its revenues in Renminbi. Under IT Tech Packaging’s current corporate

structure, IT Tech Packaging’s Nevada holding company may rely on dividend payments from the PRC Subsidiary to fund any cash and

financing requirements it may have. Under existing PRC foreign exchange regulations, payments of current account items, including profit

distributions, interest payments and trade and service-related foreign exchange transactions, can be made in foreign currencies without

prior approval of State Administration of Foreign Exchange, or SAFE, by complying with certain procedural requirements. However, approval

from or registration with appropriate government authorities is required where Renminbi is to be converted into foreign currency and remitted

out of China to pay capital expenses such as the repayment of loans denominated in foreign currencies. As a result, we need to obtain

SAFE approval to use cash generated from the operations of the PRC Subsidiary and VIE to pay off their respective debt in a currency other

than Renminbi owed to entities outside China, or to make other capital expenditure payments outside China in a currency other than Renminbi.

If the foreign exchange control system prevents us from obtaining sufficient foreign currencies to satisfy our foreign currency demands,

we may not be able to pay dividends in foreign currencies to its shareholders. See “Risk Factors — Risk Factors

Relating to Doing Business in China — Governmental control of currency conversion may limit our ability to utilize our

revenues effectively and affect the value of your investment”. In order to secure the amounts owed under the VIE agreements,

the VIE and its shareholders entered into a share pledge agreement with the PRC Subsidiary, pursuant to which if the VIE fails to pay

the service fees to the PRC Subsidiary pursuant to the exclusive technical service and business consulting agreement or fails to perform

their other obligations under the other management agreement, the PRC Subsidiary is entitled to dispose of the pledged equity interests

in the VIE.

IT Tech Packaging declared

and paid four quarterly cash dividends to its U.S. investors in April 2012 and November 2013. As of the date of this annual report, other

than those cash dividends, none of IT Tech Packaging’s subsidiaries have ever issued any dividends or made other distributions to

IT Tech Packaging or their respective holding companies nor has IT Tech Packaging or any of IT Tech Packaging’s subsidiaries ever

paid dividends or made other distributions to U.S. investors. IT Tech Packaging currently intend to retain all future earnings to finance

its operations and to expand its business. As a result, IT Tech Packaging does not expect to pay any cash dividends in the foreseeable

future.

Holding

Foreign Company Accountable Act

Trading

in our securities may be prohibited under the Holding Foreign Companies Accountable Act, or the HFCAA, if the Public Company Accounting

Oversight Board (United States) (the “PCAOB”) determines that it cannot inspect or investigate completely our auditor.

Pursuant

to the HFCAA, the PCAOB issued a Determination Report on December 16, 2021 which found that the PCAOB is unable to inspect or investigate

completely registered public accounting firms headquartered in: (1) mainland China of the People’s Republic of China because of

a position taken by one or more authorities in mainland China; and (2) Hong Kong, a Special Administrative Region and dependency of the

PRC, because of a position taken by one or more authorities in Hong Kong. In addition, the PCAOB’s report identified the specific

registered public accounting firms which are subject to these determinations.

The

PCAOB is currently unable to conduct inspections in China without the approval of Chinese government authorities. If it is later determined

that the PCAOB is unable to inspect or investigate our auditor completely, investors may be deprived of the benefits of such inspection.

Any audit reports not issued by auditors that are completely inspected by the PCAOB, or a lack of PCAOB inspections of audit work undertaken

in China that prevents the PCAOB from regularly evaluating our auditors’ audits and their quality control procedures, could result

in a lack of assurance that our financial statements and disclosures are adequate and accurate.

6

Our

auditor, WWC, P.C., Certified Public Accountants, is an independent registered public accounting firm with the PCAOB, and as an auditor

of publicly traded companies in the U.S., is subject to laws in the U.S. pursuant to which the PCAOB conducts regular inspections to assess

its compliance with the applicable professional standards. WWC, P.C., Certified Public Accountants, is based in the United States and

has been inspected by the PCAOB on a regular basis, with the last inspection in November 2021. WWC, P.C., Certified Public Accountants,

is not headquartered in mainland China or Hong Kong and was not identified as a firm subject to the determinations announced by the PCAOB

on December 16, 2021. Should the PCAOB be unable to fully conduct inspection of our auditor’s work papers in China, it will make

it difficult to evaluate the effectiveness of our auditor’s audit procedures or equity control procedures. Investors may consequently

lose confidence in our reported financial information and procedures or quality of the financial statements, which would adversely affect

us and our securities.

Moreover,

if trading in our securities is prohibited under the HFCAA in the future because the PCAOB determines that it cannot inspect or fully

investigate our auditor at such future time, an exchange may determine to delist our securities.

See

“Risk Factors—Risks Associated with Our Company— A recent joint statement by the SEC and the Public Company Accounting

Oversight Board (United States), or the “PCAOB,” proposed rule changes submitted by Nasdaq, and the newly enacted “Holding

Foreign Companies Accountable Act” all call for additional and more stringent criteria to be applied to emerging market companies

upon assessing the qualification of their auditors, especially the non-U.S. auditors who are not inspected by the PCAOB. These developments

could add uncertainties to investing in our securities.”

Recent

Business Developments

March

2021 Public Offering

On

March 1, 2021, the Company offered and sold to the public investors an aggregate of 29,277,866 shares of common stock and 14,638,933

warrants to purchase up to 14,638,933 shares of common stock in a firm commitment underwritten public offering for gross proceeds of

approximately $21.9 million. The purchase price for each share of common stock and accompanying warrant sold in the offering was $0.75.

The warrants are exercisable commencing on March 1, 2021 at an exercise price of $0.75 and will expire on March 1, 2026. In the event

of a stock split, stock dividend, combination, subsequent right offering or reclassification of the outstanding shares of Common Stock,

the exercise price and the number of shares issuable upon exercise of the warrants shall be proportionately adjusted. The Company intends

to use the net proceeds from the offering for general corporate and working capital purposes.

January

2021 Public Offering

On

January 20, 2021, the Company offered and sold to certain institutional investors an aggregate of 26,181,818 shares of common stock and

26,181,818 warrants to purchase up to 26,181,818 shares of common stock in a best-efforts public offering for gross proceeds of approximately

$14.4 million. The purchase price for each share of common stock and the corresponding warrant sold in the offering was $0.55. The warrants

are exercisable commencing on January 20, 2021 at an exercise price of $0.55 and will expire on January 20, 2026. In the event of a stock

split, stock dividend, combination, subsequent right offering or reclassification of the outstanding shares of Common Stock, the exercise

price and the number of shares issuable upon exercise of the warrants shall be proportionately adjusted. The Company intends to use the

net proceeds from the offering for general corporate and working capital purposes.

Cogenerating

Project

In

November 2020, we completed inviting bids for the 75 tonne per hour biomass boiler procurement for our biomass cogeneration project.

Multiple well-known enterprises in the biomass industry participated in tendering opening bids. In February 2021, we completed evaluation

on the bidding proposals and announced that Tai Shan Group Co., Ltd., a top manufacturer in the biomass industry in China, has won the

bid. Installation of the boilers is expected to commence in the near future. We expect to participate in the bidding process for urban

central heating projects.

Tissue

Paper Production Line

In July 2021, The Company

announced that the Company’s tissue paper research and development center has received a Level B scale-above Certification as an

industrial R&D enterprise institution in Hebei province after on-site inspection by regulators. The Company has also been

granted twelve new utility patent certificates on paper manufacturing related equipment issued by the State Intellectual Property Office,

including equipment testing, screening and filtering, and mixing.

Summary

of Risk Factors

Investing

in our securities involves significant risks and uncertainties. You should carefully consider all of the information in this prospectus

before making an investment in our securities. Below please find a summary of the principal risks we face, organized under relevant headings.

These risks are discussed more fully in the section titled “Risk Factors.”

7

Risks

Relating to our Business

● We may not be able to effectively control and manage our growth.

● We are responsible for the indemnification of our officers and directors.

● Our operating results may fluctuate as a result of factors beyond our control.

● We face risks related to product liability claims.

● If we are unable to respond to pricing pressures, our business may be harmed.

Risks

Related To Doing Business in the PRC

8

● The fluctuation of the Renminbi may harm your investment.

Risks

Related to Our Corporate Structure

9

Risks

Related to Our Common Stock

● Future financings may dilute stockholders or impair our financial condition.

Impact

of COVID-19 on Our Operations and Financial Performance

Outbreaks of epidemic, pandemic,

or contagious diseases such as COVID-19, could have an adverse effect on our business, financial condition, and results of operations.

The spread of COVID-19 has resulted in the World Health Organization declaring the outbreak of COVID-19 as a global pandemic.

Substantially all of our revenues and workforce are concentrated in China. In response to the intensifying efforts to contain the spread

of COVID-19, the Chinese government took a number of actions, which included extending the Chinese New Year holiday, quarantining individuals

suspected of having COVID-19, asking residents in China to stay at home and to avoid public gathering, among other things. During the

early part of 2020, COVID-19 caused temporary closure of our CMP production, and as a result, our revenue of CMP decreased by 49.89

% in the first quarter of 2020.

Since we resumed business

operations after the outbreak of COVID-19, the Company kept continuous attention on the development of the COVID-19 pandemic and reacted

actively to its impact on the financial position and operating results of the Company. As of the date of the annual report, COVID-19’s

adverse impacts on the company’s financial position and operating result as of December 31, 2021 were limited.

Our

Business

We, through our subsidiaries

and VIE, engage in production and distribution of three categories of paper products: corrugating medium paper, offset printing paper,

tissue paper products and medical face masks in China.

Our

principal executive offices are located at Science Park, Juli Road, Xushui District, Baoding City, Hebei Province, People’s Republic

of China.

Our

telephone number is (86) 312-869-8215. Our website is located at http://www.itpackaging.cn.

10

Manufacturing

Process

Corrugating

Medium Paper and Offset Printing Paper

Our

current products (excluding tissue paper products) generally undergo two stages of manufacturing: (1) creating pulp from recycled paper

products, and (2) treating the pulp and molding it into the desired types of paper products. A brief overview of the pulp and papermaking

process is provided below.

Pulping

The

recycled waste paper is first sorted by machine, and then broken down and beaten or smashed into small pieces using water and mechanical

energy. It is then put through a course screening drum, followed by a fine screening drum to separate different grades of pulp, a process

that we refer as “concentration”. In order to purify the pulp further, an approach flow system is used to filter out any

impurities or inconsistencies, such as sand, in the pulp.

Paper

Making

The

pulp is sieved to remove the excess water and molded into a specific size. The moisture content is further reduced by applying hydraulic

pressure to the pulp. The pulp then enters the drying section where it is rolled over by heated cylinders. The dried paper is then coated

with a mixture of clay, white pigment and binder to produce a surface on which ink can sit without being fully absorbed, enabling crisper,

and more consistent print quality.

The

paper goes through a process called calendaring, which flattens and smoothens the paper into long sheets. The paper is then wound onto

a reel that is mounted in a roll-slitting machine for rewinding, during which cutters are used to cut the paper into the desired widths.

Upon completion, the rolls are fitted with sleeves and labeled, and then sent to quality control before shipment or storage.

11

Base

Tissue Paper

While

we make tissue paper products, we currently purchase paper pulp from suppliers and use it to manufacture base tissue paper directly.

Products

Corrugating

medium paper

Corrugating

medium paper, or CMP is used in the manufacturing of cardboard. Since the launch of our new Paper Machine (“PM6”) production

line in December 2011, corrugating medium paper has become a major product of the Company. For the year ended December 31, 2021, corrugating

medium paper comprised approximately 88.76% of our total paper production quantities and roughly 83.61% of our total revenue. Raw materials

used in the production of corrugating medium paper include recycled paper board (or Old Corrugating Cardboard or “OCC,” as

it is commonly referred to in the United States) and certain supplementary agents. In January 2013, we suspended the operation of our

PM1 production line for renovation, which was then used to produce corrugating medium paper. In May 2014, we launched the commercial

production of a renovated PM1 production line. The renovated PM1 production line produces light-weight corrugating medium paper with

a specification of 40 to 80 grams per square meter (“g/s/m”). PM1’s light-weight corrugating medium paper products

have a wide range of commercial applications. For example, they can be used as a construction material for wall and floor insulation

or to manufacture moisture-proof packaging materials for the transportation of books and magazines by the publishing industry. It can

also be used as corrugating medium to make corrugating cardboard for packaging that requires light-weight boxes. The manufacturing process

of light-weight corrugating medium paper is similar to that of the regular corrugating medium paper and also uses recycled paper boards

as a major source of raw material. We now have two corrugating medium paper production lines, PM6 and PM1. We refer to products produced

from the PM6 production line as Regular CMP and products produced from the PM1 production line as Light-Weight CMP.

Offset

printing paper

Offset

printing paper is used for offset printing in the publishing industry. Offset printing paper comprised approximately 8.21% of our total

paper production quantities and approximately 10.61% of our total sales revenue for the year ended December 31, 2021. Raw materials used

in making offset printing paper include recycled white scrap paper, fluorescent whitening agent and sizing agent. We currently have two

production lines, PM2 and PM3, for the production of offset printing paper.

Tissue

Paper Products

We

began the commercial production of tissue paper products in Wei County Industry Park in June 2015. We process base tissue paper purchased

from long-term cooperative third party and produce finished tissue paper products, including toilet paper, boxed and soft-packed tissues,

handkerchief tissues and paper napkins, as well as bathroom and kitchen paper towels that are marketed and sold under the Dongfang Paper

brand. In December 2018 and November 2019, we completed the construction, installation and test of operation of PM8 and PM9, respectively,

and commercially launched tissue paper production of PM8 and PM9 at such time. On May 5, 2020, the Company announced it planned the commercial

launch of a new tissue paper production line PM10 and the Company signed an agreement to purchase paper machine with paper machine supplier.

The Company expected the new tissue paper production line to be launched after the completion of trial run. Tissue paper products comprised

approximately 3.01% of our total paper production quantities and approximately 5.45% of our total sales revenue for the year ended December

31, 2021.

Face

Masks

On

April 29, 2020, we launched a production line of non-medical single-use face masks, following the completion of raw materials

preparation, trial run of the equipment and the sample products inspection. In January 2021, the Company announced it has submitted an

application for the license for its new single-use surgical masks from local food and drug administration in Hebei province, and began

commercial production in November 2021.

12

Market

for our Products

The

PRC Paper Making Industry

According

to the 2020China Paper Industry Annual Report, issued by the China Paper Association, there were approximately 2,500 paper and paper

board manufacturers (down from 2,700 in 2019) in China, with a total output of 112.60 million tonnes, up by 4.60% from 107.65 million

tonnes in 2019. Total domestic consumption was 118.27 million tonnes in 2020, up by 10.49% from 107.04 million tonnes in 2019.

The

output of paper and paper board maintained an average growth rate of approximately 1.41% during the ten-year period from 2011to 2020,

while consumption increased at an average annual rate of 2.17%. The growth is expected to continue. It is estimated that China currently

has the largest paper and paper board products output and consumption in the world. (Data source: 2020 Annual Report of China Paper

Manufacturing, April 2021, China Paper Association)

Data

source: 2020 Annual Report of China’s Paper Industry, April2021, China Paper Association

Corrugating

medium paper production in China totaled 23.90 million tonnes in 2020, a 7.66% increase from 2019. Consumption of corrugating medium

paper in China amounted to 27.76 million tonnes in 2020, an increase of 16.93% as compared to 2019.

Uncoated offset printing paper

production in China totaled 17.30million tonnes in 2020, a 2.81% decrease from 2019. Consumption of uncoated offset printing paper in

China amounted to 17.83million tonnes in 2020, an increase of 1.94% as compared to 2019.

The

paper making industry in China is concentrated in the east coast provinces. The largest paper production capacities by province for 2019and

2020(the most recent year for which relevant information is available) are summarized in the table below. The three provinces with largest

capacities showed moderate increases in paper production capacities; provinces with smaller capacities, such as, Chongqing, Hebei and

Anhui, showed noticeable increases as well.

Province 2020Capacity (10k tonnes) 2019 Capacity (10k tonnes) % Change

Data

Sources: 2020Annual Report of China’s Paper Industry, April 2021, China Paper Association

13

Customers

We generally sell our corrugating

medium paper to companies making corrugating cardboards and offset printing paper to printing companies. Our largest customer is a packaging

company in Shandong Province. Our total corrugating medium and offset printing paper revenue in 2021 was primarily derived from customers

in Tianjin City, Hebei Province and Shandong Province.

For

the year ended December 31, 2021, five major customers who individually accounted for more than 5% of our total sales revenue are as

follows:

Sales Amount

(USD$, net of % of

applicable Total

VAT) Revenue

Eight

of our top-ten customers of 2021are also in the top-ten customer list in 2020, representing 79.36% of the 2020top-ten customer sales.

Target

Market

We

target corporate customers in the middle range of the marketplace, where, with solid quality and competitive pricing, we see potential

for high volume growth for corrugating medium paper and offset printing paper. Our primary market has been the region of North China,

especially in the province of Hebei.

Our

Production Lines

During

the year ended December 31, 2021, we had six PM production lines in operation and are in the process of launching one more that are designated

as PM7. These production lines include the followings:

Designed

Paper Product Capacity

PM# Produced (tonnes/year) Owned by Operated by Status as of December 31, 2021

PM1 Corrugating Medium Paper 60,000 Dongfang Paper Dongfang Paper In production

PM2 Offset Printing Paper 50,000 Dongfang Paper Dongfang Paper In production

PM3 Offset Printing Paper 40,000 Dongfang Paper Dongfang Paper In production

PM8 Tissue paper 15,000 Dongfang Paper Dongfang Paper In production

PM9 Tissue paper 15,000 Dongfang Paper Dongfang Paper In production.

PM10 Tissue paper 20,000 Dongfang Paper Dongfang Paper In construction

14

On

December 31, 2009, we acquired a digital photo paper production line, including two coating lines that are designated as PM4 and PM5

and ancillary equipment, for a total purchase price of approximately $13.6 million. We suspended production of photo paper in June 2016.

In

order to meet the growing domestic demand for paper, which we believe currently exceeds domestic supply in the case of corrugating medium

paper, especially in the region of North China, we installed a corrugating medium paper production line (PM6) with a designed capacity

of 360,000 tonnes per year. We completed the installation of the PM6 production line in November 2011 and began commercial production

in December 2011.

We

have implemented a plan to renovate one of the old production lines that has been idle since the end of 2007. We previously made paper

with anti-counterfeit features from that production line. When the renovation is completed, we intend to use the renovated production

line to produce high-profit margin specialty papers. Our current plan is to complete the renovation project, put in place a new production

and marketing team and launch the renovated production line as PM7 by the end of 2021.

On

November 27, 2012, we signed a 15-year lease relating to approximately 49.4 acres of land in the Economic Development Zone in Wei County,