After receiving the Notice of Tax Matters on March 1, 2024, Company A believed that the county tax bureau made an erroneous conclusion on the audit of land tax clearance and hoped that it could resort to the legal remedy procedure to safeguard its own rights and interests. on March 5, 2024, the staff of Company A went to the Tax Dispute Assistance Center of the county tax bureau to file an application for assistance, and submitted the information on the application for assistance on the spot. The center received the materials submitted by the plaintiff and told the staff of Company A to go back and wait for the notification of the processing results. Company A did not rush to pay the tax because it believed that the county tax bureau had made obvious errors in its conclusion on the liquidation of the land tax and assumed that the assistance center would be able to properly resolve the tax dispute. During this period, the staff of Company A visited the Assistance Center several times to enquire about the progress and results of the processing, but the Assistance Center has not been able to give a clear answer.

Because Company A was delayed in waiting for the results of the assistance center, and the 30-day deadline for payment of taxes required by the County Tax Office had already expired and started to incur late fees, Company A, in order to prevent the loss of late fees, eventually abandoned its application for assistance, paid all the taxes and a small amount of late fees on April 5, 2024, and submitted a written application for administrative reconsideration to the Municipal Tax Office on April 10, 2024, requesting that the Municipal Tax Office revoke the Notice of Tax Matters issued by the County Tax Office. Department of Revenue to rescind the Notice of Tax Matters issued by the County Department of Revenue.

On April 15, 2024, the Municipal Taxation Bureau issued a Decision on Not Accepting the Application for Administrative Reconsideration to Company A, considering that Company A had not paid the tax and late payment fee in accordance with the time limit determined by the tax authority, nor provided the corresponding tax guarantee within the time limit determined by the tax authority, and deciding not to accept the application for administrative reconsideration filed by Company A according to the provisions of Article 33(2) of the Rules for Administrative Reconsideration of Taxation. Company A was not satisfied with the decision and sued the Municipal Taxation Bureau to the court.

II. What are the legal conditions for the acquisition of the right to tax administrative review?

In the aforementioned case, the reason why the Municipal Taxation Bureau did not accept Company A's application for reconsideration was essentially that it considered that Company A did not enjoy the right to administrative reconsideration of taxation. To determine whether the practice of the Municipal Taxation Bureau is correct or not, the first step is to determine what are the legal conditions for a taxpayer to obtain the right of administrative reconsideration according to the relevant laws.

1. The Administrative Review Law provides that the administrative relative's right to administrative review is automatically acquired, with the only limitation being that it is automatically extinguished upon expiration of the period of time.

Article 20, paragraph 1, of the Administrative Reconsideration Law provides that "Where a citizen, legal person or other organization believes that an administrative act infringes upon his or her lawful rights and interests, he or she may file an application for administrative reconsideration within sixty days from the date on which he or she knew or should have known of the administrative act; however, the time limit for filing such an application provided for by the law shall not exceed sixty days."

According to this provision, the administrative relative automatically obtains the right to administrative reconsideration after knowing or should have known of the specific administrative act made by the administrative organ, without any additional conditions, and the only exclusion provision is the expiration of the 60-day period. In addition, the Administrative Review Law, as a general law, also grants other special laws the space to extend the period of such review, i.e., if the provisions of other laws are longer than 60 days, they shall be implemented in accordance with the provisions of other laws.

The legislative intent, it is not difficult to see, administrative review law only in the administrative relative to exercise their right to review in the case of negligence will be deprived of the right to review, in addition to the administrative review law of the administrative relative to obtain the right to review does not set any additional conditions, nor set any elimination of the right to review of other circumstances, in essence, to protect the administrative relative to the right to review, and to urge the administrative relative to actively exercise the right.

2. The Tax Administration Law sets preconditions for taxpayers to obtain the right to reconsideration and does not create additional circumstances that deprive them of the right to reconsideration

Article 88, paragraph 1, of the Tax Administration Law provides that "when a dispute arises between a taxpayer, a withholding agent, or a tax guarantor and a tax authority over tax payment, the taxpayer must first pay or pay off the tax and late payment penalties in accordance with the tax authority's tax payment decision or provide a corresponding guarantee, and then may apply for administrative reconsideration in accordance with the law."

Accordingly, the Tax Administration Law has adjusted the automatic right of reconsideration provided for in the Administrative Reconsideration Law, i.e., the administrative relative shall obtain the right of reconsideration only after fulfilling the preconditions of "paying off the late payment of tax or providing a tax guarantee in accordance with the tax decision of the tax authority". It should be noted that the Tax Administration Law does not extend or shorten the period of administrative reconsideration, nor does it increase the circumstances that deprive the right of reconsideration. Therefore, combining the provisions of the above two laws, the deadline for taxpayers to file administrative reconsideration of tax disputes should also be 60 days from the date when the taxpayer knew or should have known that the taxpayer needs to fulfill the preconditions for obtaining the right to reconsideration and file an application for administrative reconsideration within the 60-day period.

3. Company A obtains the legal right of administrative reconsideration in accordance with the Tax Administration Law, and submits an application for administrative reconsideration within the statutory period in accordance with the Administrative Reconsideration Law, so that Company A's right to administrative reconsideration shall be protected by law.

In the aforementioned case, on March 1, 2024, the county tax bureau served a tax decision to pay 30 million yuan of additional land tax. According to the provisions of the Administrative Review Law and the Tax Administration Law, Company A should obtain the right of reconsideration and apply for reconsideration by paying the full amount of tax or providing guarantee before May 1, 2024.Company A paid the full amount of tax and late fee on April 5, 2024, and filed an application for administrative reconsideration with the Municipal Taxation Bureau on April 10, 2024, which was not only obtaining the right of reconsideration in accordance with the Tax Administration Law, but also obtaining the right of reconsideration within the statutory time limit in accordance with the Administrative Reconsideration Law. The right to reconsideration was obtained in accordance with the provisions of the Tax Administration Law, and the application for reconsideration was filed within the statutory period in accordance with the provisions of the Administrative Reconsideration Law.

Therefore, Company A's right to administrative reconsideration should be protected by law, and the Municipal Taxation Bureau should accept Company A's application for reconsideration in accordance with the provisions of the two laws. The Municipal Taxation Bureau's decision not to accept the reconsideration not only lacked any legal basis, but also violated the Tax Administration Law and the Administrative Reconsideration Law, infringing on Company A's right to administrative reconsideration.

III. The intent of the Tax Administrative Review Rules is to further extend the period of review, not to deprive the right to administrative review

    1. The intent of the Tax Administrative Review Rules was to further extend the review period

Paragraph 2 of Article 33 of the Rules for Administrative Reconsideration in Taxation stipulates that "Where an applicant applies for administrative reconsideration in accordance with the provisions of the preceding paragraph, he or she must first pay or pay off the tax and late payment fees in accordance with the amount of tax and the time limit determined by the tax authorities in accordance with the laws and regulations, or provide the corresponding guarantees, and then the application for administrative reconsideration can be filed within 60 days from the date of confirmation by the tax authorities of the tax payment and the late payment fee, or of the guarantees provided. The application for administrative reconsideration may be filed within 60 days from the date of confirmation by the tax authority that issued the specific administrative act."

It can be seen that the above provisions of the Rules essentially extend the deadline for administrative review. The reason for this is that the provisions of the Tax Administration Law and the Administrative Review Law require the taxpayer to obtain the right to review within the review period, whereas the above provision of the Rules suspends the calculation of the review period while the taxpayer is obtaining the right to administrative review, and then starts the calculation of the review period from the date of obtaining the right to review after the taxpayer has complied with the requirement to obtain the right to review.

Why are the Rules so designed? The reason is that it is possible that the tax payment period for a certain tax provided for in laws and regulations may exceed the review period of 60 days, and if the right to review is obtained by paying the tax within 60 days in accordance with the provisions of the Administrative Review Law and the Tax Administration Law, the tax payment period exceeding 60 days by law may, on the contrary, be compressed to less than 60 days, thus infringing the taxpayer's rights. Therefore, the Rules directly exclude the time spent by taxpayers in obtaining the right of reconsideration from the period of reconsideration in order to safeguard both the taxpayers' rights and interests in the time for payment of tax and the taxpayers' right of administrative reconsideration.

In addition, when we comprehensively examine the provisions of Articles 32 and 33 of the Rules and analyze them from the perspective of system interpretation, it is also not difficult to see that the Rules firstly establish a reconsideration period of 60 days from the date of knowledge or ought to be, then stipulate that the calculation of the period for reconsideration shall be stopped for reasons of force majeure, etc., and then stipulate that the period for reconsideration shall be extended due to the need to pay tax. In general, the State Administration of Taxation has formulated the Rules for the purpose of better safeguarding the taxpayers' right to administrative reconsideration, rather than setting up obstacles to the taxpayers' right to administrative reconsideration, or even depriving the taxpayers of their statutory right to reconsideration.

2. The Tax Administrative Review Rules do not have the legal effect of depriving the right to administrative review

Paragraph 2 of Article 33 of the Administrative Review Rules on Taxation refines the preconditions for taxpayers to obtain the right to review, namely, to "pay or pay off the tax and late payment fees or provide corresponding guarantees in accordance with the amount of tax and the time limit determined by the tax authorities in accordance with the laws and regulations". Compared with the Tax Administration Law, the requirement for a "time limit" has been added.

In practice, if the taxpayer exceeds the deadline set by the tax authorities to pay taxes, what legal consequences should arise? In the author's opinion, it should produce the effect of depriving the taxpayer of the right to extend the period of reconsideration, without producing the effect of directly depriving the right of reconsideration, and at the same time, it triggers the legal responsibility of charging late fees.

In the aforementioned case, the deadline set by the county tax office for payment of the tax is 30 days, i.e., Company A should pay the tax by April 1, 2024 in full. If Company A pays the tax on March 25, 2024, Company A may obtain the right to extend the review period from March 25, 2024 to May 25, 2024 in accordance with Article 33(2) of the Rules. However, since Company A paid the tax late due to the delay in waiting for the tax dispute assistance, Company A lost the right to extend the time limit for reconsideration, and the provisions of Article 33, paragraph 2, of the Rules shall no longer be applicable, and the provisions of the Law on Tax Administration and the 60-day provision of the Administrative Reconsideration Law shall be applicable instead.

3. Late payment of taxes is not reviewable as a misinterpretation and application of the Rules

In the aforementioned case, the Municipal Taxation Bureau considered that Company A should be deprived of the right of reconsideration according to Article 33(2) of the Rules because it failed to pay the tax within the 30-day period. In the practice of tax administration, there are indeed some tax authorities holding such a viewpoint, which the author considers to be a mistake in understanding and applying the provision.

First of all, the Rules are departmental regulations formulated by the State Administration of Taxation, with an order of validity much lower than that of the Administrative Reconsideration Law and the Tax Administration Law, which cannot formulate rules that deprive the administrative relative of the right to reconsideration procedures, and can only formulate rules in favor of the administrative relative.

Article 5 of the Measures for the Formulation and Implementation of Tax Sectoral Regulations (State Administration of Taxation Decree No. 45) stipulates that "the formulation of tax regulations shall be in accordance with the provisions of the supreme law, embodying the principle of the unity of authority and responsibility, and shall effectively safeguard the lawful rights and interests of the tax administrative counterparts.

Without the basis of laws or administrative regulations, decisions or orders of the State Council, tax regulations shall not set norms that derogate from the rights or increase the obligations of tax administrative counterparts, nor shall they increase the powers or reduce the statutory duties of the department."

Accordingly, if the Rules are interpreted and applied in accordance with the viewpoint of the Municipal Tax Bureau in the case, the provisions of article 33, paragraph 2, of the Rules are clearly a derogation of the rights of the tax administrative counterparty and a reduction of the statutory duties of the tax authorities, which is contrary to the requirements for the formulation of rules and regulations.

Secondly, even according to the logical understanding and application of the Rules by the Municipal Tax Bureau in the case, the conclusion of inadmissibility of reconsideration cannot be reached. The author assumes that the purpose of Article 33(2) of the Rules is to deprive the right of reconsideration, then according to the meaning of the article, when the taxpayer is required to "pay or pay off the tax and late payment in advance in accordance with the amount of tax and time limit determined by the tax authorities in accordance with the laws and regulations," it is necessary for the tax authorities to satisfy the prerequisites, namely The tax collection instrument issued by the tax authority should have the condition that "the tax amount and time limit determined by the tax authority in accordance with laws and regulations".

In other words, the "time limit" determined by the tax authority should have and only have the basis of "laws and regulations", if the "time limit" determined by the tax authority does not have the basis of any laws and regulations. If the tax authorities determine the "time limit" without any basis in laws and regulations, only departmental regulations, tax normative documents, or even can not find any clear basis, then first of all, the behavior of the tax authorities themselves can not meet the requirements of this article, and even more so, should not be required to taxpayers in accordance with the implementation of this article, which will produce the so-called deprivation of the right to review effect.

For example, in the aforementioned case, the county tax bureau determined that the deadline for tax payment was 30 days, and the entire text of China's Provisional Regulations on Land Value-Added Tax did not have a statutory basis for the 30-day deadline for payment of tax, and since land value-added tax had not yet been legislated, it was bound to have no legal basis. In other words, there is no legal and regulatory basis for the 30-day tax payment period determined by the tax authorities, and in fact, there is only the basis for the tax normative document of the land value-added tax clearing and management measures issued by the provincial tax bureau. Therefore, the provisions of article 33, paragraph 2, of the Rules simply cannot be applied to this tax dispute.

Ⅳ. Fully guaranteeing taxpayers' right to reconsideration is conducive to constructing a tax collection and payment relationship of equality, trust and cooperation

The guidance document "Practicing the Mass Line of the Party in Tax Modernization Construction" of the Theoretical Study Center Group of the Party Group of the State Administration of Taxation, published on the official website of the State Administration of Taxation on August 1, 2014, points out that, "Relying on the masses to create a renewed concept of governance is a pioneering and strategic task for the construction of tax modernization. Realizing the conceptual transformation from "management" to "governance" is a pioneering and strategic task in the construction of tax modernization. It is necessary to establish the concept of good governance, change the mindset of "managing" taxpayers, focus on taxpayers, put governance in service, and establish a tax collection and payment relationship of equality, trust and cooperation. To establish the concept of the rule of law, through the participation and supervision of the masses, to promote the tax authorities at all levels and the vast number of tax officials to always tighten the string of the rule of law, to improve the ability to use the rule of law thinking and the rule of law way of doing the work, so that all the work is always along the track of the rule of law." "Insisting on coming from the masses and going to the masses means going deep into the masses to ground, strengthen and build up a positive atmosphere, and obtaining inexhaustible power from the masses to push forward the work."

The seventeenth item of the Opinions on Further Deepening the Reform of Tax Collection and Administration issued by the General Office of the Central Committee of the Communist Party of China and the General Office of the State Council on March 24, 2024 requires, "safeguarding the legitimate rights and interests of taxpayers and fee payers. Improve the mechanism for taxpayers' and contributors' rights and remedies and tax disputes resolution, and smooth the channels for effective collection of claims, rapid response and timely feedback."

It can be seen that the administrative reconsideration activity is not only an important right for taxpayers to safeguard their legitimate rights and interests, but also an important duty for tax authorities to practice the Party's mass line of coming from the masses to the masses. In recent years, the state has attached higher importance to safeguarding the legitimate rights and interests of taxpayers and perfecting the dispute resolution mechanism for taxes and fees, and the protection of taxpayers' right to administrative reconsideration has become an important requirement for further deepening the reform of the fiscal and taxation system, and an indispensable requirement for the Chinese government to practice administration in accordance with the law and to build a government of the rule of law. Local tax authorities should, as far as possible, fully guarantee the taxpayers' right to administrative reconsideration and fully fulfill their legal duties, so as to truly construct a tax collection and payment relationship of equality, trust and cooperation.

Conclusion: On April 8, 2024, the State Administration of Taxation (SAT) announced on its official website the 2024 Plan for the Formulation of Tax Sectoral Rules and Regulations, which puts the revision of the Tax Administrative Review Rules on the agenda. As the new Administrative Review Law has been changed a lot, the revision of the Tax Administrative Review Rules will mainly focus on the content of the new review law to make corresponding adjustments and improvements. The author expects that the amendment will also respond appropriately to the controversial issue of whether the late payment of tax can be reconsidered in practice, and clear the obstacles for taxpayers to resort to reconsideration and other legal remedial procedures to safeguard their legitimate rights and interests.