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Editor's Note: In June 2026, the Inspection Bureau of the Hami Municipal Tax Service served by public notice a Decision on Tax Treatment (Hami Tax Inspection Treatment [2026] No. 21) and a Decision Not to Impose a Tax Administrative Penalty (Hami Tax Inspection No-Penalty [2026] No. 3). The logistics company involved had obtained falsely issued special VAT invoices and claimed input VAT credits. Its VAT and urban maintenance and construction tax underpayments were characterized as tax evasion, but no penalty was imposed because the five-year limitation period for penalties had expired. As for enterprise income tax, because the company's books and records were missing and an audit-based determination was impossible, the Inspection Bureau assessed the tax payable by estimation; it neither characterized the matter as tax evasion nor imposed a fine. Taking this case as its starting point, this article analyzes why tax assessed by estimation should not serve as the basis for either a finding of tax evasion or the calculation of a penalty. It also discusses the separate application of the tax recovery period and the limitation period for penalties, as well as the availability of tax incentives for small low-profit enterprises under assessment by estimation, with a view to providing guidance to relevant market participants.

Recently, the State Taxation Administration disclosed a case involving an individual proprietorship that engaged in "escape-style" cancellation. The actual controller of this individual proprietorship concealed operating income of RMB 207 million from the entity's business activities and subsequently evaded tax obligations by completing deregistration. The tax authority characterized such conduct as tax evasion and issued a decision to recover the tax underpaid, impose late payment surcharges and impose penalties against the actual controller. In practice, there are also numerous instances where legal persons (e.g., limited liability companies) and unincorporated organizations (e.g., partnerships) evade tax obligations through means such as submitting false materials for deregistration, and tax authorities pursue tax recovery from individual shareholders of dissolved companies or partners of dissolved partnerships. Under such circumstances, can tax authorities directly pierce through the business entity and pursue tax liabilities against natural persons? This article intends to analyze different types of business entities for readers' reference.

Editor’s Note：In recent years, regulatory scrutiny over the application of tax incentive policies has continued to intensify, and businesses are now operating in an environment of heightened regulatory scrutiny and increasingly stringent compliance requirements for claiming tax incentives. As demonstrated by recently published typical cases, many enterprises were not found to have fraudulently obtained tax incentives. Instead, they incorrectly applied tax incentive policies due to factors such as misunderstanding policy requirements or changes in the conditions for eligibility, ultimately resulting in additional tax assessments and late payment surcharges. Drawing on these typical cases, this article examines the principal risk scenarios associated with the improper application of tax incentive policies, analyzes the characteristics of fraudulent claims for tax incentives and the corresponding legal consequences, and offers practical compliance recommendations to assist enterprises in properly claiming tax incentives and managing tax risks.

Editor’s Note: Recently, the Shanghai No. 2 Intermediate People’s Court rendered the second-instance criminal judgment No. (2025) Hu 02 Xing Zhong 752, changing the conviction at first instance from the offense of falsely issuing special VAT invoices to the offense of falsely issuing invoices. This case is a typical example in the refined-oil trading sector where false issuance was used to evade consumption tax supervision. On the basis of unchanged fact-finding, the appellate court corrected the application of law. The judgment not only aligns with the narrowing of the criminal scope of the offense of falsely issuing special VAT invoices under the tax-related judicial interpretation issued by the Supreme People’s Court and the Supreme People’s Procuratorate, but also reaffirms an important adjudicative rule: the object of the offense of falsely issuing invoices may include special VAT invoices. Taking this case as an entry point, this article analyzes the legal logic behind the appellate recharacterization and discusses the determination of charges and defense strategies in refined-oil false-issuance cases, with a view to providing practical reference for similar cases.

In March 2024, the Judicial Interpretation of the Supreme People’s Court and the Supreme People’s Procuratorate Concerning Criminal Cases Involving Tax-Related Crimes introduced major revisions to the statutory constitutive elements of the crime of defrauding export tax rebates. It consolidated the two categories of false export declarations and other tax fraud conduct into a single enumerated provision, while deleting the wording “for the purpose of fabricating facts of taxable goods being exported” under the clause governing false export declaration tactics. Compared with the previous provisions, this revision has led some case-handling authorities to instinctively presume that any deceptive tactic listed in the dual-high judicial interpretation automatically constitutes the crime of defrauding export tax rebates, sharply elevating criminal risks related to export tax rebate fraud. According to incomplete statistics, 13 publicly reported cases involving export tax rebate fraud emerged in the first half of 2026 alone, among which six involved low-value goods declared at inflated prices. These cases feature enormous sums involved and severe criminal liabilities. With regard to such cases, the author holds that conduct of declaring low-value goods at inflated prices does not invariably amount to the crime of defrauding export tax rebates. This article briefly analyzes three typical cases of inflated-value declarations for low-value exports, summarizes the common characteristics of such cases, and interprets inflated-value declaration conduct from the fundamental mechanism of export tax rebates for readers’ reference.

Editor's Note: Since the beginning of 2026, tax authorities in various regions have centrally exposed multiple typical tax-related cases in the online online live streaming industry, with tax risks erupting frequently. In June 2025, the Provisions on the Submission of Tax-Related Information by Internet Platform Enterprises took effect, expressly setting forth the obligation of online live streaming platforms to submit tax-related information and signaling a continued tightening of tax supervision in the online live streaming sector. This article reviews cases from recent years and relevant new tax regulations, examines the typical tax risks faced by various participants in the online live streaming industry, and offers tax compliance recommendations for reference.

Editor’s Note: Recently, in its 2025 annual audit work report, the National Audit Office specially disclosed the findings of an audit investigation into the production and distribution of traditional Chinese medicine (TCM), identifying RMB 4.652 billion in problematic amounts. The issues involved inflated procurement costs for Chinese medicinal materials, fabricated selling expenses, “sales with kickbacks,” and the erosion of medical insurance funds, among others. Taking this as the point of entry, and against the backdrop of increasingly strict coordination among tax inspections, healthcare-sector rectification, and anti-commercial-bribery regulation, this article reviews the tax-related risks in the TCM production and distribution chain and the logic behind their formation, and puts forward compliance suggestions for TCM enterprises to prevent and control tax risks.