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Two Major False Invoicing Risks Faced by the Coal Industry and Response Strategies
Due to the scarcity of coal resources, each coal mine operates in a seller's market. As a result, coal trading enterprises and coal-consuming businesses often struggle to obtain sufficient value-added tax (VAT) special invoices during procurement. Additionally, given the prevalent use of individual transport capabilities in China's road transportation, the transportation costs incurred in coal buying and selling transactions cannot acquire adequate invoice documentation. Over time, this situation has led to challenges for coal trading enterprises and coal-consuming businesses in managing the associated corporate income tax and VAT burdens.To address these issues, many coal trading enterprises and coal-consuming businesses opt to obtain VAT special invoices through third-party channels, thereby triggering the risk of false invoicing. Currently, numerous cases of false invoicing involving coal enterprises have erupted nationwide. In the context of ongoing collaborative efforts by tax authorities to combat tax fraud, continuous upgrades and optimizations of the Golden Tax Phase III system, and the increasing intelligence of data-driven comparisons, tax and judicial authorities are managing invoices in a more real-time fashion.In response, coal enterprises should conduct regular self-assessments to promptly identify potential tax risks. Simultaneously, when dealing with ongoing cases of false invoicing, attention should be paid to understanding the nature of transactions from both the formal and substantive aspects.1904Views
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Title: Major Announcement: A Coal Enterprise Suspected of Involvement in a 45 Million RMB "False Billing" Case Settles Without Prosecution
On April 27, 2022, the criminal investigation into a coal enterprise, represented by Huashui Agency, suspected of issuing false value-added tax special invoices (with a total value of over 45 million RMB) was concluded. The X City, Y District Procuratorate issued a non-prosecution decision to the involved enterprise, stating that the evidence provided by the X City Public Security Bureau, Y Sub-Bureau, was insufficient to establish the crime of issuing false value-added tax special invoices and did not meet the conditions for prosecution. After nearly two years of defense work by Huashui lawyers, the case resulted in a non-prosecution decision by the prosecutor's office, receiving high recognition from the client. Due to reasons such as tax policies and industry characteristics, the coal industry has consistently been a hotspot for false billing cases, with high tax-related risks. This article summarizes and analyzes the specific handling of this case, along with its core legal issues. The aim is to provide useful insights for the judicial handling of similar cases involving enterprises suspected of issuing false invoices in the future.1995Views
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Tennis string cycle export tax fraud tens of millions! Analysis of Circular Export Risks and Key Points of Foreign Trade Compliance
Recently, Xinhuanet reported that the Economic Investigation Corps of the Shanghai Municipal Public Security Bureau, together with the Baoshan Public Security Bureau, and the Inspection Bureau of the Shanghai Municipal Taxation Bureau, jointly detected a case of using low-priced "tennis strings" and "badminton strings" as props and goods to circulate exports to defraud tax refunds, involving tens of millions of tax refunds. As a typical illegal act of defrauding export tax rebates, circular export has strong concealment and harmfulness. In view of this, this article takes this case as a starting point to analyze the types of businesses that use circular exports to defraud taxes, and provides defense space and compliance suggestions for the majority of foreign trade enterprises to study and reference.2432Views
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How can foreign trade enterprises achieve tax rebate compliance in seven cases of non-export tax rebate?
The export tax refund (exemption) tax policy is a tax policy commonly adopted in international trade, which can reduce the tax burden of export enterprises and also promote the development of foreign trade. China has introduced various tax refund (exemption) policies and export facilitation measures in various provinces and cities by improving the speed of the export tax refund business and strengthening the cooperation of multiple departments, which have helped the export enterprises to get out of the predicament and realize sustainable development. However, some enterprises do not know enough about the export tax rebate (exemption) entity and the procedure and other elements, which leads to the failure of export tax rebate, or some enterprises make use of the policy to cheat the tax, resulting in serious loss of national tax. Therefore, this paper analyzes the situation of non-export tax refund from the practical point of view, and puts forward corresponding compliance suggestions for readers' reference.1822Views
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Frequent major cases in the coal industry, involving multiple taxes and tax risks
The coal industry over the years as the country's important energy industry and economic pillar industry, is to promote the national economic construction of the cornerstone, the state has repeatedly used tax policy means of regulation of the coal industry, such as 2022 to strengthen the energy supply security and the implementation of the zero tariff policy on coal imports. At the same time, the coal industry is also the hardest hit by the outbreak of tax-related problems, and has always been the focus of tax audits, the state has repeatedly emphasized the strengthening of the coal and other key areas of tax-related violations of the crackdown, previously carried out by the coal industry to check the twenty-year action makes the coal enterprises on tax-related compliance to bring up "twelve points" of vigilance. In recent years, not only has the crackdown on the issue of fraudulent invoicing in the coal industry persisted, but the issue of tax evasion in multiple tax categories in the industry has also received the attention of the tax authorities one after another.2099Views
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Pharmaceutical anti-corruption storm is coming, fictitious "marketing expenses" cash bribes become a high risk of taxation
Under the anti-corruption work, a number of hospital directors and pharmaceutical companies have recently been investigated on suspicion of serious disciplinary violations, a large number of academic conferences have been suspended or postponed, the market value of listed pharmaceutical companies fell, ipo was suspended or rejected, and even a famous pharmaceutical company delisted from the market. In the context of anti-corruption, a large number of pharmaceutical enterprises sales costs in the "gray area" was uncovered, tax compliance is faced with the question, anti-corruption process can be expected to involve tax administrative and criminal responsibility. In this paper, we will observe the new trend of regulation of pharmaceutical enterprises under the trend of anti-corruption, analyze the tax risk points of pharmaceutical enterprises, and provide suggestions for pharmaceutical enterprises to cope with tax inspections in the following period for the benefit of readers.2140Views
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Anti-Corruption Escalation Affects Many Pharmaceutical Listed Companies, Tax Compliance Becomes a Key Link to Cope with Multiple Legal Risks
"two votes system" is fully implemented, the field of traditional medicine over the ticket model collapsed, and then produced a CSO, CSP and other new industry organizations to join the pharmaceutical purchasing and marketing links. In fact, the pharmaceutical industry with gold sales, the phenomenon of commercial bribery does not change, drug companies, false openings, tax evasion is difficult to effectively curb the tax side of the pharmaceutical industry, to a certain extent, the strict supervision of the field of corruption in the field of tax issues continue to promote the hidden, mutation, escalation. As listed companies have the obligation to disclose their financial and operational status, the abnormal cost and expense of listed pharmaceutical companies are more easily monitored, and the problem of false billing and tax evasion is a risk that is of common concern to the exchanges and the tax authorities. At present, the pharmaceutical field of corruption has been focused on remediation, listed companies must pay more attention to the real business, tax compliance, to avoid tax-related risks further implicated in the IPO halted or delisted from the market.2149Views
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A number of enterprises were canceled high-tech qualification, facing serious tax-related risks
In order to encourage mass entrepreneurship and innovation, and promote economic upgrading and development, enterprises in line with the provisions of the Administrative Measures for the Recognition of High-tech Enterprises are able to enjoy the enterprise income tax rate of 15% type of concessions, and at the same time, enjoy the extension of the number of years of loss carry-forward and other tax incentives. In recent years, a number of high-tech enterprise certification bodies to strengthen the supervision and management of high-tech enterprise qualification, has issued a number of cancellation of high-tech enterprise qualification announcements, enterprises face the risk of paying back taxes and late fees or even tax evasion. In this paper, from the identification requirements of high-tech enterprises, we list the common cases of high-tech qualification being canceled in practice, in order to suggest the risk for readers' reference.6066Views