In order to promote the development of software industry and the construction of China's informationization, China's tax law stipulates that general taxpayers selling self-developed and produced software products shall implement the policy of immediate tax rebate for the portion of their actual VAT burden exceeding 3%. In practice, this tax incentive policy has been utilized by unscrupulous people, creating many cases of fraudulent tax incentives. Recently, a software enterprise fraudulent tax incentives and then fraudulent export tax rebate case triggered concern, the case reflects the software industry tax-related criminal behavior has been through the domestic sales and exports. In this regard, foreign trade enterprises should strengthen the attention to the risk of tax fraud in the export business of software products and take effective measures to prevent and control the risk.

I. Brief Introduction: Integration of Fraudulent Tax Preferences, False Opening and Fraudulent Export Tax Refund

(I) Basic facts of the case

On February 15, 2022, China Taxation News reported the audit details of Ningbo's "6-10" case of fraudulent export tax rebate using the preferential policy of instant tax credit for software enterprises under the title of "serial cheating under the halo of high-tech products", which involved The case involved 54 enterprises in 14 provinces and cities across the country, involving an amount of 2.773 billion yuan, of which Ningbo was involved in the amount of price tax totaling 321 million yuan, tax rebate amounted to 43.48 million yuan.

After investigation, Luo Moubin, Li Mou and other gangs led by the first in the preferential policies of the region to establish software enterprises, the use of very low prices from the upstream companies to purchase raw materials, such as chips without real function, processed into the so-called "attitude stabilization controller", and at the same time, at a very low price of no real function of the "soil moisture sensor", and at a very low price of "soil moisture sensor", and at a very low price of "soil moisture sensor", and at a very low price. Soil Moisture Sensor" at a very low price, sold to the associated midstream production enterprises, and issued special VAT invoices with the name of software, so as to apply to the local tax authorities for VAT refund for software products (refund of VAT for the part of the actual tax burden exceeding 3%), and fraudulent local tax incentives. After that, Luo Moubin and others forged false export order contracts, entrusted foreign trade companies with real export business, falsely exported "attitude stabilizing controller" and "soil moisture sensor" and issued false VAT invoices, and then made false declaration of export tax rebate to the tax department, so as to apply for VAT refund (refund of 3% of actual tax burden) for software products to the local tax department and cheat local tax concessions. The company declared export tax refund and cheated the national export tax refund, and has been recognized to deal with the export tax refund of 43,481,800 yuan.

Among them, Kong Moyan is the actual operator of one of the foreign trade companies involved in the case, in the knowledge that Luo Moubin and others to implement fraudulent export tax rebates, but still through its actual operation and its introduction of foreign trade companies, to help Luo Moubin false export of no practical function of the "soil moisture sensors" and other products, and in the country with the illegal exchange of foreign exchange in RMB, and then through the foreign companies in the form of payment for goods. Then through the foreign company in the form of payment for goods in the form of foreign exchange, to create false funds to go, in order to declare to the state tax authorities for export tax rebates. In just three months, KongMouYan help LuoMouBin and others cheat export tax rebate of more than 1.83 million yuan.

(II) case results

Recently, the People's Court of Yinzhou District, Ningbo City, Luo Moubin, Li Mou and Kong Mouyan, the main people involved in the case, the three were convicted of fraudulent export tax refunds, Li Mou was also convicted of the crime of fraudulent issuance of VAT invoices; the three were sentenced to 13 years, 10 years and 10 months, three years, and a fine of 36 million yuan, 6.57 million yuan, 950,000 yuan. Public security officials said that several other suspects involved in the case will soon be transferred to prosecution.

II. fraudulent tax concessions and then fraudulent export tax rebates, the software industry to strengthen the prevention of

In recent years, China's software industry operating situation continues to improve, according to the Ministry of Industry and Information Technology announced in 2021 China's software and information technology service industry operation data show that in 2021, China's software industry national scale above enterprises has more than 40,000, 2021 year cumulative completion of the software business income of 9,499,400,000,000 yuan, a year-on-year increase of 17.7%, the two-year compound growth rate of 15.5%. From the perspective of taxation, tax incentives such as VAT instant refund for software products and additional deduction for R&D expenses play a very important role.

According to Article 1 of the Circular of the Ministry of Finance and the State Administration of Taxation on the VAT Policy for Software Products (Cai Shui [2011] No. 100), a general VAT taxpayer that sells its self-developed and produced software products and collects VAT at a rate of 17% (now 13%) will be subject to the policy of immediate refund of the portion of the actual VAT tax burden that exceeds 3%. In addition, in some regions, if a software enterprise is registered and established locally, in addition to enjoying the policy concessions granted by the State, it can also enjoy the incentive and support rebate of the local tax retention portion. These tax incentives are intended to promote the development of the software industry and the construction of China's informationization. However, the tax incentives for software products have been paid attention to by unscrupulous persons, who have utilized the tax incentives to create a number of cases of fraudulent invoicing to obtain tax incentives. For example, in May 2021, the State Administration of Taxation (SAT) exposed a case of fraudulent invoicing for subsidies using the VAT-as-a-refund tax incentives for software products:

Another example is a case pronounced by the Intermediate People's Court of Guangyuan City, Sichuan Province in late 2021:

In April 2018, Company W was registered with the Market Supervision Administration of Zhaohua District, Guangyuan City, the company's business scope of technical research and development, production and sales of electronic products, software development and other software and information technology services, and obtain the qualification of general taxpayers, enjoying the national "instant levy, instant rebate" and Zhaohua District's local preferential policies, the company's The legal representative is Tianmou, the actual control is Yaomou. In July of the same year, Yao Mou, Tian Mou to W company processing of electronic chips posing as high-tech products, the use of national tax incentives, in the name of false high-tech research and development funds to accept the other companies to falsely open 53 VAT invoices, the total value of 5 million yuan; to take the fabrication of false production, sales behavior, and other ways, to fraudulently enjoy the national tax "tax that is refund" preferential policies, the use of the national "that is refund" preferential policies, using the legal representative of Tian Mou, the actual control person is Yao Mou, the company legal representative is Tian Mou. "preferential policies," the use of "low-value high open" techniques to issue a large number of downstream VAT invoices that do not match the actual business situation 711, the total value of tax 74.7668 million yuan. As of June 2019, VPC caused a loss of 105,956,880.70 yuan in national tax funds.

In recent years, the use of software products value-added tax that is refund tax incentives for false invoicing, fraudulent preferential cases in recent years is not uncommon, and the use of the policy to fraudulent preferential and then fraudulent export tax rebate cases are rarely exposed. 2021, the State Administration of Taxation in batches of exposure of nine cases of tax fraud, Ningbo "6-10" Ningbo "6-10" Case of Fraudulently Obtaining Export Tax Refunds by Utilizing Preferential Policies on Software Products is one of them, and it is the only case involving preferential policies on software products among the 9 cases of tax fraud. In the fraudulent export tax rebates on the modus operandi, Ningbo "6-10" the use of software enterprises that is refund preferential policies to obtain export tax refunds and the previous exposure of fraudulent export tax rebates case is a rut, are through false invoicing, false export, false foreign exchange settlement and other behaviors to create a false impression of exports, so as to fraudulently obtain the state's export tax refunds. However, this case is further extended in the operation link and depth of the crime, combining the two types of activities of cheating the tax concession of the state for software products by creating the illusion of software development and production and cheating the export tax refund by creating the illusion of software export, realizing the integration of cheating the tax concession of software products, falsely issuing VAT invoices, and cheating the export tax refund, and the harmfulness is further strengthened. At present, although the number of cases similar to this case is not much, the occurrence of this case shows to a certain extent that the activities of cheating export tax rebate and cheating tax incentives have been linked together, and the composite tax cheating activities of cheating tax incentives + cheating export tax rebate shall draw the attention of all parties, including the enterprises in the software industry.

III. foreign trade enterprises can be recognized from the following five aspects of the scam to avoid risks

In this case, in addition to Kong Moyan's foreign trade enterprises, there are a number of foreign trade enterprises involved in the case. According to the "China Tax News" disclosure of relevant information, this case there are two foreign trade enterprises are unknowingly involved in this case, and ultimately suffered financial and credit losses, and the main reason is gullible acquaintances, friends, gullible "high-tech products" and other names, not in accordance with the routine to the commissioning agent to the production of in-depth verification of the place of production. Combined with the details of the tax department's audit disclosed in this case, we believe that foreign trade enterprises can identify and prevent such illegal and criminal business from the following aspects:

(I) Field verification of production of upstream enterprises

According to the provisions of the tax law, enterprises with the qualification of foreign trade operators acting on behalf of production enterprises to export goods can declare export tax rebates in accordance with the law. For the authenticity of export business, foreign trade enterprises have certain verification obligations. In this case, the tax department audit found that most of the software production enterprises involved are located in remote areas, with no signs of activity in their business premises and no corresponding equipment, and obviously do not have the production capacity of software research and development and electronic products. If the foreign trade enterprises involved in the so-called software products, electronic products before the agent exports, send relevant business personnel to the production and operation of the production enterprises to carry out field verification, it is easy to be able to detect the clues and discover the truth of false production and processing, so as to avoid falling into the trap of tax fraud.

(II) Strictly control the functional quality of exported goods

As foreign trade enterprises act as agents for exporting goods, since foreign trade enterprises are neither producers of exported goods nor users of exported goods, they often neglect to control the functional quality of exported goods, leaving tax cheats with opportunities to use worthless goods to falsely declare exports, and low-value goods to falsely declare exports and cheat the state of tax refunds. In this case, the production enterprise involved in the processing and production of software analyzed by the testing agency, on the one hand, found that the product process is simple, low value of components. On the other hand, by going to Shenzhen, Wenzhou and other places on the attitude stabilization controller and other similar products of the real chip manufacturers to investigate and collect evidence, the product samples involved in the test, found that the product samples involved in the two low-priced chip, resulting in the product or simply can not burn the software listed in the product manual, or although it can be burned, but up to the function listed in the product manual, which means that the product does not use the function and the value. value. Foreign trade enterprises acting as agents for exports, if the functional quality of the goods is not clear, should be compared with similar goods in the market, or find professionals to test to ensure that the functional quality of exported goods is real and reliable.

(III) Comprehensive consideration of export regions and market demand

Examination of the real situation of foreign enterprises to determine the authenticity of the business, for some foreign trade enterprises have considerable difficulty, in this case, through the export region of the product, the market demand situation to assist in judgment. In recent years, China's tax fraud cases, the foreign counterparties are mostly Hong Kong or Southeast Asian enterprises, the reason is that these areas are easy to set up associated enterprises to create fraud, on the other hand, because these areas border with or near the mainland of China, easy to create a false impression of the goods transported for export, and even take back the goods within the territory of the recycling and export to create fraud. In addition, for some of the so-called "high-tech products", a large number of exports to some developing countries in Southeast Asia within a short period of time does not meet the market demand, so if the upstream and downstream enterprises continue to carry out a huge amount of business purchases and sales, and even increasing the volume of trade, the foreign trade enterprises need to be more guarded.

(IV) on the high price, large volume of export goods to raise vigilance

In this case, according to the export enterprise record documents, the inspectors found that the enterprise declared the export of posture stabilizer controller, according to the weight conversion, the value is equal to gold. Ningbo, another import and export enterprises exported a similar model, the number of larger, unit price close to the same product, the export amount of price and tax totaled nearly 200 million yuan. In addition, the inspectors learned from the professionals that if the export of these attitude stabilization controllers is real, they are able to assemble all the civil drones in the world. From this audit, it is clear that the price of the exported goods and the quantity exported exposed the illusion of the export business. In practice, in order to quickly cheat a large amount of tax, tax cheats usually in a short period of time a large number of "export" goods, and overstated the price of goods, therefore, if the foreign trade enterprises in the export business agent found that the production enterprises export goods with high prices, export volume characteristics, should be alert, and in a timely manner on the verification of the business.

(V) of "acquaintances" "friends" should not be taken lightly

Foreign trade enterprises to carry out export business, in many cases are introduced by others. Usually, based on acquaintances, friends of the natural trust, foreign trade enterprises introduced to the business will have a higher degree of trust, relax the control of the authenticity of the business, which is more likely to fall into the trap of tax fraud. In this case, two foreign trade enterprises in the aftermath of the tax fraud scam will be involved in the reason attributed to gullible acquaintances, friends, another state-owned foreign trade enterprises is directly pointed out that "this business gullible from the national influence, good reputation of the security company out of the salesman, resulting in problems. This is a warning to foreign trade enterprises, for acquaintances, friends introduced by the same business can not be taken lightly, the export business in all aspects of the strengthening of control is a reliable way to prevent risks.

IV. fall into the tax fraud scam, foreign trade enterprises self-redemption of the core strategy

The composition of tax fraud export tax rebates must simultaneously meet the subjective and objective aspects of the elements, therefore, in the foreign trade enterprises inadvertently fall into the tax fraud scam, should start from the subjective and objective aspects of the effective defense.

(I) Arguing that there is no objective tax fraud: starting from the goods are real, the documents are complete, and the funds are reasonable.

In the tax fraud cases in which foreign trade enterprises are involved due to being utilized, usually the upstream and downstream enterprises of the foreign trade enterprises have been proved to have implemented the tax fraud, however, it does not mean that the foreign trade enterprises have also implemented the tax fraud. In the foreign trade enterprises were blinded to use to become other people's tax fraud tool, can not be other people's tax fraud on the foreign trade enterprises. Foreign trade enterprises can be exported from the real goods, the relevant documents are complete, reasonable financial transactions and other perspectives and upstream and downstream enterprises to draw a clear line of tax fraud.

From the overall perspective, upstream and downstream enterprises use foreign trade enterprises to implement tax fraud is a multi-party body together to form a tax fraud activities, but look carefully, foreign trade enterprises as an intermediate link, in the absence of conspiracy with the upstream and downstream, if it can confirm that the goods are really exported, filing documents are ready to be retained, and the financial transactions are normal and reasonable, indicating that it is not able to detect the transaction of the false, identify the conspiracy of the tax cheating molecules, then the foreign trade enterprises themselves will be There is no false declaration of tax fraud, just be used as a tool for tax fraud, although it has been involved in the case, but it does not mean that it has implemented tax fraud, constituting tax fraud.

(II) Argumentation of Subjective No Tax Fraud Intention: Based on Business Process, Benefit Distribution and Company Nature

When foreign trade enterprises are blindfolded and utilized to become others' tax fraud tools, foreign trade enterprises have neither tax fraud conspiracy nor tax fraud cognition with others. As a result, foreign trade enterprises can be subjectively unaware of tax fraud, tax fraud does not have the intention to defend. Of course, subjectivity is seen in objectivity, subjective ignorance of tax fraud, no tax fraud intention, need to be argued on the basis of objective facts. According to Huatax's experience in representing relevant cases, this can be clarified from the perspectives of business process, distribution of benefits and nature of the company. Regarding the business process, the strict approval of business start-up, programmed management and layers of gate-keeping in the process of business development can show that the company does not want to implement tax fraud; for the distribution of benefits, the foreign trade enterprise only earns reasonable profits from export business, and the benefits of tax rebate are seized by tax cheats, which can show that the foreign trade enterprise itself does not have the purpose of tax cheating; supplemented by the fact that, generally speaking, if the foreign trade enterprise belongs to the state-owned enterprises or centralized enterprises, the company nature determines that it will not have the intention of tax cheating; and it is necessary to prove that it does not have the intention of tax cheating. nature determines that it will not have the motive of tax fraud. Of course, according to the law, the burden of proof of the subjective purpose lies in the case-handling authorities, and the foreign trade enterprises by taking the initiative to prove that they do not have the intention of tax fraud, can better assist in identifying the truth and realizing the maintenance of their own rights and interests.