Editor's Note: Recently, the Supreme People's Court released eight typical cases of punishing crimes endangering tax collection and management according to law, involving crimes endangering tax collection and management, such as tax evasion, evading the recovery of tax arrears, defrauding export tax rebates, and falsely issuing special invoices for value-added tax, which effectively responded to new situations and problems in tax-related criminal practice and provided typical judicial samples for the practical application of tax-related judicial interpretations of the two universities. This paper analyzes two cases of tax evasion and one case of tax evasion.

I. Guo and Liu's tax evasion case: it is a crime of tax evasion to take false means to deduct taxes within the scope of taxable obligations.

(1) Basic information of the case

From February to December, 2018, Suo Mou Company actually controlled by Guo Mou and Liu Mou obtained special VAT invoices from the above-mentioned companies for tax deduction without real transactions with a trading company in Luzhou, Sichuan Province, with a total price tax of 160 million yuan and a tax amount of more than 23 million yuan. After investigation, in 2018, Suo Company declared an output tax of more than 52 million yuan, and declared a VAT input tax deduction of more than 50.25 million yuan.

Tianjin Xiqing District People's Court held that Guo and Liu violated the national tax administration regulations and allowed other companies to falsely issue special VAT invoices for Suo's company to deduct taxes without real transactions, which was huge, and their actions all constituted the crime of falsely issuing special VAT invoices; The defendant Guo was sentenced to 13 years and 6 months in prison and fined 400,000 yuan; The defendant Liu was sentenced to four years and six months in prison and fined RMB 150,000. After the verdict was pronounced, the defendant Guo appealed. The Tianjin No.1 Intermediate People's Court held that the key to the division between the crime of falsely issuing special VAT invoices and the crime of tax evasion lies in whether the perpetrator subjectively cheated the state tax or evaded the tax obligation. If an actor who has the obligation to pay taxes deducts by false promotion items within the scope of taxable obligations to pay less taxes, which constitutes a crime, even if the means of false deduction is adopted, it is still subjectively not paying or paying less taxes. According to the principle of unity of subject and object, it should be punished as tax evasion; Guo and Liu made false tax returns by deception, which led to a huge amount of tax evasion and accounted for more than 30% of the taxable amount, which constituted the crime of tax evasion; The defendant Guo was sentenced to six years in prison for tax evasion and fined 400 thousand yuan; The defendant, Liu, was an accessory and sentenced to two years' imprisonment for tax evasion and fined RMB 150,000.

(B) the distinction between false opening and tax evasion: we should adhere to the principle of unity of subject and object and adaptability of crime and punishment.

In judicial practice, there are many disputes about how to understand the crime of tax evasion by falsely making out tax deductions or making out special VAT invoices. The Supreme Court judge pointed out in the article Understanding and Application of the judicial interpretation of the two tax-related departments that "if a taxpayer makes a deduction through a false promotion item to pay less tax within the scope of taxable obligations, even if the means of false deduction is adopted, it is still subjectively not paying less tax. According to the principle of unity of subject and object, it should be punished as tax evasion. This is also the consideration stipulated in Item 3, Paragraph 1, Article 1 of the Interpretation that "falsely offsetting the input tax amount" is one of the "deception and concealment means" for tax evasion. "The judgment view of this case is consistent with the above view, that is, if a taxpayer uses false means to deduct tax within the scope of taxable obligations, it should be punished as tax evasion, which is in line with the core spirit of the two tax-related judicial interpretations, and it is also a crime of falsely deducting tax.

From the principle of consistency between subject and object, the "crime clause" in Article 10, paragraph 2, of the two tax-related judicial interpretations, the crime of "falsely offsetting the input tax" stipulated in the crime of tax evasion and the above-mentioned cases all show that falsely issuing special invoices for value-added tax can be used as a means of tax evasion. The taxpayer's behavior of falsely issuing special invoices does not constitute a crime of falsely issuing special invoices, and it is necessary to consider whether it has the purpose of defrauding the tax and whether it causes the tax to be defrauded. From the principle of suiting crime to punishment, the nature and harm of the two crimes are obviously different. The crime of tax evasion strikes at the behavior of not fulfilling the duty to pay taxes and evading paying taxes. This kind of behavior of "falsely offsetting the input tax" by false means causes the loss of national tax application; The crime of falsely issuing special invoices for value-added tax strikes at the act of defrauding the state tax, that is, the actor "cheats" the state's tax collected by means of falsely issuing for the purpose of illegal possession, which is even more harmful. It is not difficult to see that the key to the definition of the two crimes lies in the determination of taxable obligations. If the input tax is falsely offset by means of false invoicing within the scope of taxable obligations, it should be punished as tax evasion. If it is beyond the scope of taxable obligations, it should be punished as false invoicing for value-added tax.

In the definition of the scope of taxable obligation, the VAT liability is determined by the difference between the output tax and the input tax, that is, the output tax formed by the real sales behavior minus the input tax reflected by the invoice obtained by the real purchase behavior, and the difference between the two is the taxpayer's taxable obligation. Within the scope of the taxable obligation, the false invoice without real transaction is obtained to offset the tax, and the less paid VAT is the tax evaded and paid. As mentioned above, in the case that the inflated input tax does not exceed the taxable obligation, it still infringes on the interests of the state in applying for tax rather than the tax paid, and should be punished as tax evasion.

(3) Accurately understand and apply the obstacles to the crime of tax evasion, and prevent and control the risks of criminal responsibility.

It is worth noting that the fourth paragraph of Article 201 of the Criminal Law stipulates the reasons for the crime of tax evasion that will not be investigated for criminal responsibility, that is, "those who commit the act in the first paragraph, after the tax authorities have issued a notice of recovery according to law, pay the tax payable and pay the late payment fee, and have been subject to administrative punishment, will not be investigated for criminal responsibility; However, except for those who have received criminal punishment for evading tax payment within five years or have been given more than two administrative punishments by the tax authorities. "

The facts published in this case are relatively simple, and the tax procedures and the reasons for refusal are not specifically disclosed. However, the emergence of more and more cases that treat the false offset of input tax as tax evasion also reminds us that we should pay attention to the above reasons for refusal and the connection of execution. For example, in the case of (2025) No.70 at the beginning of the new 2323 criminal sentence, there was also a case of tax deduction by falsely issuing invoices. The inspection bureau identified the enterprise's behavior as tax evasion and imposed a fine, and the enterprise involved failed to pay the tax, late payment fee and fine within the prescribed time limit, nor did it file a reconsideration or lawsuit. The court held that the person involved in the case made a false tax return with a special ticket falsely issued by others, which was huge and accounted for more than 30% of the tax payable. After the tax authorities punished him according to law, he refused to perform the taxpayer's obligations, and his behavior constituted the crime of tax evasion.

The judicial interpretations of the two tax-related departments clearly state that "if a taxpayer evades paying taxes and the tax authorities fail to issue a notice of recovery according to law, they will not be investigated for criminal responsibility according to law", that is, for tax evasion, it should be based on the tax authorities' first administrative treatment, and they cannot directly enter criminal proceedings without administrative treatment by the tax authorities. Under normal circumstances, if the tax evasion is defined and punished first, the taxpayer can give full play to the cause of criminal responsibility by paying taxes, late fees and fines within the prescribed time limit. However, in practice, the determination of tax evasion often occurs at different stages. For example, in this case, the first instance is punished as a false crime, while the second instance is sentenced as a crime of tax evasion. In this case, there are many disputes about how to give full play to the cause of tax evasion and whether the case can be returned to the tax level, which needs to be clarified by legislation or judicial practice.

II. Tax evasion case of Xinjiang Baimou Real Estate Development Co., Ltd. and Mao Moumou: tax evasion through yin-yang contract and failure to pay taxes within the time limit was convicted of tax evasion.

(1) Basic information of the case

From 2012 to 2018, the defendants Mao Moumou and Zhou Moumou (deceased) engaged in the "Linmouyuan" real estate development and construction project in Shawan County and sold it to the outside world by attaching to and using the real estate development qualification of the defendant unit Baimou Company in Xinjiang. In the meantime, by taking part of the house payment collected into Zhou's personal bank card to conceal income; Signing a contract for the sale of commercial housing that is inconsistent with the actual collection amount, and not reporting according to the actual collection amount; Knowing that the compensation houses for demolition should be regarded as sales declaration, but not declaring the compensation houses for demolition without invoices, the business tax, value-added tax, urban maintenance and construction tax and enterprise income tax were not paid or underpaid, totaling more than 3.86 million yuan, accounting for 30.49% of the taxable amount. On November 30, 2020, the Inspection Bureau of Taxes Bureau in Tacheng, Xinjiang delivered a decision on tax administrative punishment and a decision on tax treatment to a company in Xinjiang, and ordered it to pay taxes within a time limit. The company failed to pay the tax within the prescribed time limit.

The People's Court of Shawan City, Xinjiang Uygur Autonomous Region held through trial that the defendant company, Xinjiang Baimou Company, evaded paying taxes and the tax amount was huge, accounting for more than 30% of the tax payable, and it still failed to pay taxes according to the regulations after being notified by the tax authorities; Defendant Mao Moumou, as the specific person in charge of the project, actively participated in the above-mentioned tax evasion, and both the defendant unit Xinjiang Baimou Company constituted the crime of tax evasion; The defendant company Baimou Company in Xinjiang was fined 500,000 yuan, and the defendant Mao Moumou was sentenced to three years in prison and fined 50,000 yuan. After the verdict was pronounced, the defendant Mao Moumou appealed, pleaded guilty and pleaded guilty, requesting a lighter treatment. The Intermediate People's Court of Tacheng District, Ili Kazakh Autonomous Prefecture, Xinjiang Uygur Autonomous Region ruled that the appeal was rejected and the original judgment was upheld.

(2) Focus on cracking down on tax evasion by using yin-yang contracts.

In the above-mentioned cases, the defendant evaded taxes by collecting money from private households, signing yin-yang contracts and other means, and failed to pay taxes within the prescribed time limit after the tax authorities issued a decision on handling and punishment. The court held that it constituted a crime of tax evasion. In the fields of real estate, equity transfer, entertainment, etc., it is very common to hide income and evade paying taxes by using yin-yang contracts. The judicial interpretations of the two high taxes explicitly include signing yin-yang contracts to hide income and property as a means of tax evasion, releasing a signal to severely crack down on tax evasion by using yin-yang contracts.

Yin-Yang contract has the characteristics of small scope of knowledge and strong concealment, and there are difficulties in tax collection and management. However, with the comprehensive promotion of digital upgrading and intelligent transformation of tax collection and management, tax authorities in many places have used big data analysis and other technical means to realize collaborative tax management in conjunction with multiple departments and accurately identify tax-related risks of yin-yang contracts. For example, in a case investigated and dealt with by the Fourth Inspection Bureau of Shenzhen Taxation Bureau, the tax authorities found that the rental income declared by the company was far lower than the rental level of the same type of property in the same area through big data analysis, and the rental level had not changed for eight years. Relying on the multi-department joint mechanism to crack down on tax violations, the tax authorities further investigated with the public security department and found that the company signed two "Yin and Yang" lease contracts with the lessee, one of which was used to register with the real estate management department, in which it was agreed to pass the corporate bank account. The other is used to agree on the actual rent, and it is clear that the difference between the contract and Yang is collected in cash without issuing invoices, and the rental income is hidden by this means of more than 27 million yuan. Under the background of "counting taxes", the efficiency of identifying abnormal tax-related behaviors of taxpayers is significantly improved, and unfair and unreasonable transaction prices are easily found. Therefore, we should avoid evading tax payment by yin-yang contract and guard against the risk of qualitative tax evasion and criminal responsibility investigation.

III. The case of Liang Moumou evading the recovery of tax arrears: transferring the property of tax-owed enterprises made it impossible for tax authorities to recover tax arrears, which constituted the crime of evading the recovery of tax arrears.

(1) Basic information of the case

Liang Moumou established Weimou Building Materials Factory, an individual industrial and commercial household in Renshou County, Sichuan Province, in January 2019, engaged in the acquisition, processing and sale of sand and gravel, and stopped operating at the end of 2021, during which he did not pay taxes as required. In October 2021, the Second Inspection Bureau of Meishan Taxation Bureau of Sichuan Province inspected the tax-related problems of Weimou Building Materials Factory during its operation, and found that the factory owed a total of 4.06 million yuan in tax payable. On February 22, 2022, the Second Inspection Bureau of Meishan Taxation Bureau delivered the Decision on Tax Treatment to Weimou Building Materials Factory, requesting to pay the above taxes within 15 days. Liang Moumou has not paid due. On March 14th, 2022, the Second Inspection Bureau of Meishan Taxation Bureau delivered the Notice of Tax Matters to the factory again, and ordered it to pay the above-mentioned tax arrears before March 18th. In order to avoid the tax authorities' recovery, from March to November, 2022, Liang Mou secretly transferred the income funds of Weimou Building Materials Factory to his son Liang Mou, including 8 transfers to the public account, totaling 3.72 million yuan, 28 transfers to the personal China Agricultural Bank account, totaling 2.82 million yuan, and 30 transfers to the personal Jingyan County Rural Credit Cooperative Association account, totaling 1.5 million yuan. The above-mentioned behavior of Liang Moumou made it impossible for Meishan Taxation Bureau to recover the corresponding taxes owed by Liang Moumou during his operation of Weimou Building Materials Factory.

The People's Court of Renshou County, Sichuan Province held that the defendant Liang Moumou owed the tax payable, and after the tax authorities issued a notice to pay the tax, he concealed the property by transferring the account funds to other people's accounts, which made the tax authorities unable to recover the unpaid tax of more than 4.06 million yuan, and his behavior constituted the crime of evading the recovery of tax arrears. In view of Liang's surrender and voluntary confession and punishment, he was given a lighter punishment according to law and a suspended sentence was applied. Accordingly, the defendant Liang was sentenced to three years' imprisonment, suspended for four years, and fined RMB 4.1 million for the crime of evading the recovery of tax arrears. After the verdict is pronounced, there is no appeal or protest within the statutory time limit. The judgment has taken legal effect.

(2) The judicial interpretations of the two high taxes explicitly evade the crime of recovering tax arrears, and the charges are activated.

Last March, the judicial interpretations of the two taxes related to tax evasion made a further explanation of what it means to "take the means of transferring or concealing property" in the crime of evading tax evasion, made clear the crime of evading tax evasion by way of positive listing and all-out clauses, and activated the application of the crime of evading tax evasion with judicial interpretation as a means of supply, providing a clear judgment basis for the judicial organs to investigate and deal with such cases.

In the cases disclosed by the Supreme Law, the people involved have not paid the tax after the tax authorities have repeatedly issued the notice of recovery, and the property of the tax-owed enterprises has been transferred and hidden to other people's accounts, which makes it impossible for the tax authorities to recover the tax arrears. Since the beginning of this year, the tax authorities in Sichuan, Liaoning and other places have also disclosed many cases of evading the recovery of tax arrears, and all relevant personnel have been investigated for criminal responsibility for evading the crime of recovering tax arrears. In public cases, people involved in the case often transfer or conceal property by disposing of assets sealed up by the tax authorities without authorization, transferring the funds collected by the company from public accounts to personal accounts, changing the registered address and legal representative information without informing the tax authorities.

(3) Under what circumstances will it constitute evasion of tax payment? How to guard against administrative and criminal risks?

In practice, the situation of unpaid taxes is not uncommon. Under what circumstances, enterprises will evade the tax payment, and under what circumstances, they will trigger the criminal liability risk of evading the crime of tax payment. How to prevent tax-related administrative and criminal risks in continuous operation deserves further attention and discussion.

First of all, the existence of the fact of tax arrears is the premise of evading administrative violations and criminal offences of recovering tax arrears. As for what is tax arrears, the Measures for Announcement of Tax Arrears (Trial) has made clear provisions, that is, taxpayers have failed to pay taxes beyond the time limit stipulated by tax laws and administrative regulations or the tax authorities have failed to pay taxes beyond the time limit set by tax laws and administrative regulations. It should be noted that, according to the "Reply of State Taxation Administration of The People's Republic of China on Issues Concerning the Time Limit for Recovering Tax Arrears" (Guo Shui Han [2005] No.813), the tax arrears are not limited by the tax recovery period, and the tax authorities can recover the tax owed by taxpayers indefinitely. Therefore, if taxpayers have objections to tax matters, they should communicate with the tax authorities in time and submit evidence materials to make statements and arguments, so as to avoid entering the state of tax arrears. If the tax payable is indeed formed but unable to pay, they should communicate with the tax authorities in time and apply for an extension of tax payment.

Secondly, taxpayers who are in arrears have evaded the recovery of tax arrears. According to the provisions of the judicial interpretations of the two taxes, giving up due creditor's rights, transferring property for free, trading at an obviously unreasonable price, hiding property, failing to perform tax obligations and leaving the supervision of tax authorities all constitute "taking the means of transferring or hiding property" to evade the recovery of tax arrears. Taxpayers who continue to produce and operate after entering the state of tax arrears should pay attention to the rationality of the purpose and the fairness of the price in the disposal of property to avoid being identified as transferring or hiding property. In addition, according to the Law on the Administration of Tax Collection and its detailed rules for implementation, taxpayers who owe more than 50,000 yuan in taxes should report to the tax authorities before disposing of their real estate or large assets.

Finally, from the principle of consistency between subjective and objective of criminal offences, taxpayers can try to avoid the accusation of recovering tax arrears from the subjective and result levels. Subjectively, it must be an act of transferring or hiding property in order to avoid the tax authorities' recovery. For example, in a case of non-prosecution, the person in charge of a tax-owed enterprise transfers the company's income to a personal account for the purpose of paying the employees' wages and operating expenses, and there is running evidence to prove that the funds transferred to his personal account are used for the company's operation and repayment of debts. The procuratorate believes that the evidence on file is not enough to determine that the subjective purpose of the person in charge of transferring the company's property to a personal account is to avoid the recovery of tax arrears. As a result, taxpayers' evasion of tax payment must lead to the prosecution standard of "making the tax authorities unable to recover the unpaid tax" reaching more than 10,000 yuan. In practice, there are disputes about how to identify "making the tax authorities unable to recover the unpaid tax" and how to determine the amount of tax. According to the Law on the Administration of Tax Collection, the tax authorities can take tax preservation measures or compulsory enforcement measures for the unpaid tax, and at the same time, they can exercise the right of subrogation and cancellation. Is it necessary for the tax authorities to exhaust the means endowed by the tax law to recover the unpaid tax? In a case, the taxpayer can defend the amount that "caused the tax authorities to be unable to recover" according to the actual situation of the case and the recovery measures taken by the tax authorities, so as to strive for favorable sentencing space.

IV. Summary

In the tax evasion cases of Guo and Liu, it is clear that those who falsely offset the input tax amount within the scope of taxable obligations should be punished as tax evasion, and the boundary between false disclosure and tax evasion is clarified. In the practice of tax-related dispute resolution, taxpayers should also focus on the application of the reasons for preventing criminal responsibility for tax evasion, and strive to resolve the risks in the administrative stage. In addition, taxpayers should confirm their income in accordance with the law and regulations in their operations, and avoid signing "yin-yang contracts" and other means to avoid paying taxes; Taxpayers who owe taxes should pay attention to whether they have reasonable commercial purposes and whether the pricing is fair, and guard against the risk of administrative and criminal responsibility for evading the recovery of tax arrears.