In daily life, in addition to providing insight into tax dynamics through the release of tax related documents, the release of hot news and typical cases also reveals tax related information. "Tax Eye News" aims to extract and interpret tax related information from news, tax related legal documents, or major tax cases, and share it with readers.

1、 Haidian District People's Procuratorate of Beijing Municipality and Haidian District Federation of Industry and Commerce issued the "Guidelines for the Compliance and Reform of Enterprises Involved in Crimes Involving Hazardous Tax Collection and Management"

On December 9, 2022, the Haidian District People's Procuratorate of Beijing Municipality Haidian District Federation of Industry and Commerce has issued the "Guidelines for the Compliance and Reform of Enterprises Involved in Crimes Involving Hazardous Tax Collection and Management" (hereinafter referred to as the "Guidelines") Clarified the four items that should be included in the compliance rectification plan of the enterprise involved: sorting out the risks existing in the internal governance structure, rules and regulations, personnel management, and other aspects of the enterprise that are closely related to the suspected crime of endangering tax collection and management; Formulate enterprise management norms to prevent the occurrence of harmful tax collection and management; Establish an effective corporate tax compliance organizational system; Establish and improve a reporting mechanism for preventing corporate tax compliance risks. The Guide also sets evaluation standards for large and medium-sized enterprises involved in cases, as well as for small and micro enterprises, and clearly stipulates compliance elements, compliance management specifications, compliance management systems, and compliance organizational systems.

Legal analysis: In March 2020, the Supreme People's Procuratorate deployed the first phase of pilot work on enterprise compliance reform. In April 2022, the pilot work of compliance reform for enterprises involved in the case was fully launched by the national procuratorial organs. Before the official release of the Guide, the Haidian Procuratorate had conducted corporate compliance for 12 enterprises that committed crimes against tax collection and management, of which 8 were subject to third-party supervision and all had completed compliance acceptance, and had made a decision not to prosecute 1 enterprise, and applied the procuratorial recommendation model to 4 enterprises. I believe that the "Guidelines" formed on the basis of this practice can provide assistance for the enterprises involved in the case to carry out tax related compliance rectification.

2、 Hainan Taxation clarifies the standard of "substantive operation"

On December 9, the State Administration of Taxation Hainan Provincial Taxation Bureau issued the "Notice of the State Administration of Taxation Hainan Provincial Taxation Bureau on Providing Substantive Operation and Management Services for Encouraged Industrial Enterprises in Hainan Free Trade Port" (QSF [2022] No. 102), Define and optimize the four standards that enterprises need to meet for their substantive operations in the Hainan Free Trade Zone (the standards for production and operation in the Free Trade Port, the standards for personnel in the Free Trade Port, the calculation of the number of employees, and the calculation of the number of days to live).

Legal review: It is well known that to enjoy the preferential tax policies of Hainan Free Trade Port, it is necessary to meet the conditions for substantive operation. However, previous documents have not quantified the criteria for "substantive operations", resulting in many disputes in practice. The issuance of Qiongshuifa [2022] No. 102 optimizes the conditions for "substantive operation". Enterprises can comply with the provisions of this document to ensure that their operations meet the standards, thereby legally applying the preferential policies of Hainan Free Trade Port.

3、 Shenzhen Municipal Taxation Bureau plans to launch a blockchain asset platform to accelerate the application of "blockchain+tax collection and management" technology

Recently, the Shenzhen Municipal Taxation Bureau of the State Administration of Taxation issued a public bidding announcement, proposing to build a "blockchain asset platform". The platform achieves functional upgrades in the following five aspects: 1. Relying on the tax digital wallet authorization mode, it will continue to enrich the taxpayer side application scenarios, and carry out business data sharing with Qianhai Administration, Maritime Administration, Industry and Information Technology Bureau, Provident Fund Center, and Small and Medium sized Bureaus. 2. "We will optimize and improve the application of tax digital wallets in tax collection and payment scenarios (private rental, real estate transaction, vehicle and vessel scenarios), providing online tax payment ticket issuance or electronic receipt query and printing functions, facilitating taxpayers' self operation.". 3. The signing and inquiry of personal information protection agreements will be increased, and information protection notifications and service agreements will be enhanced. 4. It will implement the functions of collecting and issuing VAT general electronic invoices on behalf of individual insurance agents, securities brokers, credit card and tourism agents, including the entire process of business, application, issuance, cancellation, query and statistics. 5. It will achieve data analysis, comparison, and matching of basic information such as taxpayers and natural persons. From this function, it can be seen that the blockchain asset platform is a clever combination of "blockchain technology" and "tax related data", utilizing the technological advantages of blockchain distribution, tamper resistance, and traceability to help mine the value of tax related data resources, increase the sharing of tax related data, and provide society with more rapid and convenient tax related services.
Legal review: As an emerging technology, blockchain has the advantages of encryption security, tamper resistance, and decentralization, which can help improve the coordination of the tax system and increase the security of the entire system. Based on the advantage of "sharing", blockchain technology can also achieve the full circulation of data assets, promote the openness of data to other departments, thereby truly opening up the circulation of tax information among tax, public security, and judicial departments, achieve the sharing of national tax data, and strengthen the fight against tax violations.

4、 The Ministry of Finance issued the "Interpretation of Accounting Standards for Business Enterprises No. 16"

On December 13, the Ministry of Finance issued "Interpretation of Accounting Standards for Business Enterprises No. 16", which mainly includes, "Accounting treatment for deferred income tax related to assets and liabilities arising from individual transactions not subject to initial recognition exemption", "Accounting treatment for income tax impact of dividends related to financial instruments classified as equity instruments by issuers" "Accounting treatment for enterprises to modify cash settled share-based payments to equity settled share-based payments.".

Legal analysis: The release of "Interpretation of Accounting Standards for Business Enterprises No. 16" helps enterprises deeply implement accounting standards for business enterprises, solve problems arising in implementation, and maintain continuous convergence between accounting standards for business enterprises and international financial reporting standards.

5、 A live video of a "tax theft case determined due to 'false tax declaration'" was exposed

Recently, a "Tax Treatment Decision" (Sui Shui Yi Ji Jian [2022] No. 136) issued by the First Inspection Bureau of Guangzhou Municipal Taxation Bureau to a trading company in Guangzhou was exposed. After providing live streaming services to four companies, including a network technology company in Guangzhou, the company failed to legally recognize revenue and file tax returns for the fees it collected, The final tax authority identified the enterprise as tax evasion on the grounds of "not listing income, false tax returns, and not cooperating with inspections", pursued the payment of the enterprise's taxes, late payment fines, and imposed a fine.

Legal analysis: In the past two years, several tax evasion cases involving the online live streaming industry have been exposed, but many practitioners still harbor a fluke mentality and use the methods of concealing income, changing the nature of income, and filing false tax returns to evade taxes. In fact, any means of violating tax laws cannot escape the supervision of big data. Practitioners should pay attention to tax compliance and guard against tax related risks.