Recently, a municipal tax bureau served 10 transportation companies with the Decision on Tax Treatment. According to the information contained in the document, the 10 companies had fled and lost contact, had no operating qualifications, and had no transportation vehicles under their names, but had issued external transportation invoices and obtained invoices for fuel and road transportation fees. The tax authorities will characterize their external invoices and invoices obtained as false invoicing. In view of this, this article to the batch of transport enterprises false invoicing case as a starting point, analysis of transport enterprises in the development of the risk of no own vehicles in the business of transportation, for the transport enterprises to provide a defense space for the majority of the transport enterprises for reference.

I. the transportation enterprises without their own vehicles external invoicing and obtaining input invoices are defined as false invoicing

(I) A city tax bureau investigated and dealt with 10 transportation enterprises, all of which were determined to be false invoicing.

Recently, according to a batch of documents delivered by a municipal tax bureau announcement, the local tax authorities have inspected the tax-related situation of 10 transportation companies since August 2023, and found that the companies involved are suspected of false invoicing, as follows:

1. the transportation companies involved are now all fled and lost.2. the transportation companies involved do not have any transportation vehicles under their names and do not have the conditions to engage in the transportation business, and are unable to engage in the transportation business.3. there is anomalous funding between the companies involved and the downstream companies in terms of funds returned or invoiced but not collected.4. the companies involved have obtained invoices for fuel oil and natural gas, but neither the carrier vehicles to use the fuel oil and natural gas, nor the storage The enterprises involved in the case obtained and offset the road toll invoices, and similarly, because there was no carrier vehicle to use the fuel and natural gas, they were considered to have obtained the road toll invoices by unlawful means.

The tax authorities believe that, because the enterprises involved in the case have no own vehicles, no transport capacity, based on which its external transportation fee invoices, obtain fuel, road transportation fee invoices offset are false suspicion, combined with abnormal capital flow, finally, the tax authorities that this group of enterprises is to falsely open VAT invoices for the purpose of the establishment of a transportation company, violence and false openings. Accordingly, the tax authorities, based on the provisions of Article 21 of the Measures for the Administration of Invoices, characterized the freight VAT invoices issued by the enterprises involved in the case as false VAT invoices for others; the VAT invoices for fuel as false VAT invoices for others; and the toll invoices obtained and deducted as false invoices for themselves.

(II) Tax Authorities' Thoughts on Determining False Invoicing

It can be observed from the 10 "Tax Treatment Decision Letters" that the tax authorities have carried out inspections on the enterprises involved in the case around services, invoices and funds, and thus determined that the enterprises involved in the case have falsely issued invoices.

First, in the service flow. Because the transportation company is different from the production enterprises, the transportation services provided by the intangible characteristics, so from the perspective of whether the transportation enterprise has the conditions to engage in transportation business. By checking the road transportation business qualification, network freight transport business qualification, the production and operation expenditure of the enterprise involved (for example, utilities, driver's salary, social security expenditure, etc.), vehicle purchase, cost consumption (for example, vehicle purchase cost expenditure, depreciation of fixed assets, etc.), dependency agreement, rental agreement, driver identity information, etc., to determine whether the enterprise involved in the provision of transportation service capacity.

Secondly, in terms of invoice flow. Tax authorities often through the police tax synthetic warfare center and import and export data analysis, found that the import and export invoices note vehicle information is inconsistent. By analyzing the input amount as a percentage of the data and the actual production and operation of the enterprise involved in the demand for consumption, production equipment, etc., to analyze whether the goods purchased by the input invoice of the enterprise involved in the case are capable of production equipment storage and so on.

Finally, in terms of capital flow. Funds flow back to the tax authorities that the enterprise involved in the existence of false invoicing behavior is one of the key clues and evidence, if there is a return of funds to the invoiced party or the invoiced party related to the individual's private account, may be considered to exist in the suspicion of fictitious funds to pay for the business is considered to be no real business.

(III) Controversy: Is the road transportation model without own vehicles feasible?

From the above, it can be seen that road transportation enterprises without their own vehicles under their names, coupled with the existence of abnormal or return flow of funds, the external issuance of VAT invoices with the name of transportation service fees and the acquisition of tolls, fuel costs for offsetting invoices, is very likely to be designated as false invoicing.

However, I note that in recent years, with the reform and development of China's road transportation industry, many transportation enterprises have appeared some "no own vehicle", to rely on, subcontracting, network freight and other modes of transportation business phenomenon. Therefore, the above behavior does not mean that the enterprise involved in the case is necessarily engaged in the illegal and criminal activities, which is related to the road transport industry business model, should be combined with the provisions of the tax law, the reasonableness of the relevant mode, the legitimacy to be reviewed. Next, the author on the transport enterprises without their own vehicles to carry out road transport services business model to introduce and analyze the risks.

II. no own vehicles to carry out road transportation services business model and its risks

(I) Dependent on the transportation enterprise with operating qualification to carry out business

Dependent business is a very common business behavior, which exists in all walks of life. As a matter of fact, the tax law clearly recognizes the behavior of dependent operation, which is clearly stated in the "Training Reference Materials on the Pilot Policy of Comprehensively Pushing Forward the Pilot of Changing Business Tax to Value-added Tax" issued by the Department of Goods and Services Tax of the State Administration of Taxation (SAT) to the local tax bureaus in April 2016, i.e., an enterprise, a partnership organization or the like has reached a dependency agreement with another business subject, and the dependent party usually engages in external business activities in the name of the party being dependent, and the dependent party provides the qualification, the service, the service, the service and the service. The dependent party usually engages in business activities in the name of the dependent party, and the dependent party provides services in terms of qualification, technology, management, etc. and collects certain management fees from the dependent party on a regular basis. Article 2 of the Implementation Measures for the Pilot Scheme for the Conversion of Business Tax to Value-added Tax, Annex 1 of the Notice on the Comprehensively Launching of the Pilot Scheme for the Conversion of Business Tax to Value-added Tax (Cai Shui [2016] No. 36), also clarifies the tax legitimacy of the operation in the form of leasing, contracting, and dependency.

In the road transportation industry, generally those drivers who have not obtained the national road transportation business qualification of individual, individual industrial and commercial households in order to legally engage in road transportation business activities, dependent on the name of the transport enterprise to engage in external transportation activities and pay a certain amount of dependency fee to the transport enterprise business behavior.

From the above enterprises were convicted of false opening, the tax authorities to adopt the "three streams of consistent" idea to review the case of false opening. Road transportation business dependency due to the existence of the invoicing party and the provision of services is inconsistent with the character of the invoicing fee is not the actual supplier, there may be cash payments, advances, deposits, etc., but also easy to appear the phenomenon of the return of funds, it is likely to be recognized by the tax authorities as a false billing.

(II) to take the transportation business "subcontracting" mode of transportation

Dependent, contracting is the current tax law clearly recognized business model. Specifically, if a transportation enterprise hires drivers, rents or buys transportation vehicles, it will bear heavy fixed assets and labor costs. Therefore, some transportation enterprises do not hire drivers and do not enter into labor contracts with drivers, but subcontract to individual drivers who run goods in the market after undertaking transportation business.

Their business model is that transport enterprises without means of transportation business, in their own name, sign transportation contracts with shippers, assume the obligations and responsibilities of carriers, and then entrust the actual carrier, i.e., individual drivers, to complete the transportation tasks. Afterwards, the transportation enterprise issues invoices and settles funds with the shipper in its own name.

Therefore, there is no vehicle in the name of the transportation enterprise and the financial statements of the vehicle purchase cost, depreciation cost, maintenance cost expenditure is a normal business situation, can not be based on these appearances to determine that the transportation enterprise does not have the ability to transport, and its external VAT invoices issued by the false invoicing.

(III) Adopting network freight transportation platform mode to conduct business

Car-free transportation as an emerging logistics industry, is a product of the era of mass entrepreneurship and innovation and the promotion of "Internet +" development. Since the beginning of 2016, after the Ministry of Transportation decided to carry out the pilot work of road freight NVOCC nationwide. Because it has the advantages of cost reduction and efficiency, integration of transportation resources, etc., it has been welcomed by the market. At the same time, to a certain extent, to solve the problem of individual drivers do not give invoices, reduce the tax burden of transportation enterprises.

After three years of vehicle-less carrier pilots, in 2019, the Ministry of Transport and the State Administration of Taxation jointly issued the Interim Measures for the Administration of Road Cargo Transportation Operations on Network Platforms, renaming vehicle-less carriers as network platform road cargo transportation operators and giving them a legal position. In addition, the document makes requirements for the behavior of network freight transport, shall not fictitious transaction, transportation, settlement information, shall not entrust each other with transportation services, false opening of false VAT invoices. Based on the consignor may choose the freight transportation platform to obtain invoices with a VAT rate of 9%, in the mode as shown in the figure, thus generating the tax risk of falsely opening VAT input invoices.

For example, part of the transportation enterprise directly with the actual carrier that is the individual driver to carry out business, after the fact, in order to obtain invoices to offset the inputs and costs, let the driver in the platform registration information, so that the fictitious contracting business, through the platform to the driver "secondary" payment of transportation fees, and then let the driver to return, easy to be set false opening, criminal risk is very high.

III. why the "three-way" transportation structure has repeatedly triggered the risk of false opening

(I) The concept of "one-to-one" service is deeply rooted.

Before the "camp to increase", transportation services are subject to business tax, but the double tax system of business tax and value-added tax restricts the development of transportation and other industries. In order to reduce the tax burden on enterprises and stimulate their vitality, China took the lead in implementing a pilot program for the transformation of the transportation industry and some modern service industries in Shanghai on January 1, 2012, and on May 1, 2016, the pilot program for the transformation of the transportation industry was fully rolled out. Although the "camp to increase" has been 7 years, but the service industry to provide services must be one-to-one, point-to-point, the nominal carrier must be the same as the actual carrier, "ticket goods" must be the same, the funds can not be returned to the concept of deep-rooted, resulting in practice, there are Excessive crackdown on the phenomenon of "false start" behavior.

(II) Downstream enterprises bring their own drivers, and the model lacks rationality.

According to our observation, in some dependent, subcontracting and network freight business, the tax authorities generally require the transportation enterprises to independently find their own carrier drivers. In practice, some shippers bring their own drivers, but still establish cooperative relationships with transportation enterprises and require them to subcontract their business to designated self-carrier drivers. Under such a model, they are often questioned by the tax police: "The downstream enterprises can obviously complete the transportation business with their own drivers, why do they need to embed the transportation enterprises in the middle?" Thereby, questioning the reasonableness of the business model and denying the real transaction as just invoicing.

(III) Inadequate internal tax compliance system of transportation enterprises

Some transportation enterprises not only lack the awareness of tax compliance, and in the system, also lacks a complete set of tax compliance system, and even in the conduct of business, reached a dependency agreement did not use the written form of the dependency agreement, or signed after the negligence of the management of the contract led to the loss of the dependency agreement, which can not be confirmed by the authenticity of the business, causing suspicion of the tax authorities. For example, under the mode of dependent business, the transportation enterprise and the individual driver do not sign the dependent agreement, or do not keep it after signing, and do not verify the driver's identity information and keep the identity information and contact information, which leads to the audit by the tax authorities, can not provide materials to confirm the authenticity of the business, and ultimately be recognized as a false opening.

(IV) Fraudulent invoicing by salespersons of transportation enterprises in collusion with downstream enterprises

The salesman of a transportation enterprise knows and is familiar with the business of the enterprise, and is the "first person" to carry out the business externally. In order to obtain unlawful benefits, the salesman of the transportation enterprise colludes with the downstream enterprises and makes use of the convenience of his position to falsely fill in the information on the platform, which, due to the lack of its own technology, is blinded by the lack of control over the authenticity of the business and the settlement of the funds, resulting in the issuance of false business invoices for the false business. which led to the issuance of invoices for the false business.

IV. the transportation enterprise false invoicing defense space

(I) The business invoicing behavior of dependence and subcontracting is in compliance with the tax law and does not constitute the crime of false invoicing.

The Research Office of the Supreme People's Court "on how to determine the nature of the act of "relying" on the name of the company concerned to implement business activities and let the company concerned to falsely issue VAT invoices for its own behavior" to seek comments on the reply (Law Research [2015] No. 58) clearly pointed out that the crime of false invoicing is an administrative crime, and the incrimination standard should refer to the administrative laws and regulations, departmental regulations. The Announcement of the State Administration of Taxation on Issues Relating to External Issuance of VAT Special Invoice by Taxpayers (SAT Announcement No. 39 of 2014) states that dependent operation is not false invoicing, and the law does not explicitly prohibit engaging in operation in the form of dependency. Cai Shui [2016] No. 36 also recognizes the legality of dependent and contracted business. Therefore, if the transportation enterprise adopts the dependency and contracting business mode to carry out business and issue invoices to the outside world, it does not belong to false invoicing in tax law, and it does not constitute the crime of false invoicing in the criminal law.

(II) Truthful invoicing behavior, subjectively not having the intention to cheat tax, objectively not causing VAT tax loss, does not constitute the crime of false invoicing.

For the behavior of truthful opening in the transportation industry, the perpetrator can provide real transportation services as a breakthrough, arguing that the VAT payment was paid through the third party, objectively did not cause the loss of national VAT tax, subjectively does not have the purpose of cheating to offset the VAT tax, does not have social harm, and does not constitute the crime of false opening. Law Research [2015] No. 58 also clearly states that such behavior does not constitute the crime of false invoicing, but at the administrative level, or in violation of the provisions of the Invoice Management Measures.

(III) Input fuel and road toll invoices can be deducted

Even if the transportation enterprise does not own transport vehicles, its fuel and road toll invoices can also be deductible. For example, according to the provisions of Article 2 of the Announcement of the State Administration of Taxation on the VAT Issues on Tax Exemption Filing of Cross-border Taxable Acts (Announcement No. 30 of 2017 by the State Administration of Taxation), the taxpayers who enter into a transportation service contract with the shippers as the carrier and entrust the transportation to the actual carriers can deduct "the refined oil and the fuel products procured by them and handed over to the actual carrier for use" and "the oil products procured by them and handed over to the actual carrier for use". The taxpayer can deduct the refined oil and the tolls paid for roads, bridges and gates "purchased and delivered to the actual carrier for use". Therefore, the transportation enterprise obtains this part of the invoice for deduction, with legal basis, does not belong to false invoicing.

For the business model of dependence, subcontracting, Cai Shui [2016] No. 36 also made it clear that, in the name of the dependant, the contractor to carry out the business, the dependant, the contractor is a taxpayer, it is a taxpayer, should be allowed to recognize the actual use of the fuel, the actual occurrence of the road transport fee invoices.

(IV) the return of funds does not necessarily constitute a false invoicing

Funds flow back is an important symptom of false opening behavior, but does not mean that the existence of funds flow back on the existence of false opening behavior, the two have no necessary relationship. In practice, the funds in the enterprise, the flow between individuals is a normal phenomenon. In particular, the transportation industry has a large number of individual households, natural persons as the actual carrier, the characteristics of the transport service transaction chain is longer, to cash payments, deposit return, capital advances, freight forwarding and other phenomena are more common, therefore, the transportation enterprises often appear to be a symptom of the return of funds. If a transport enterprise has a relevant return of funds, it is advisable to be able to sign a written statement with the driver and the consignor to confirm the reasons why the return of funds has occurred.