THE LAW OF THE PEOPLE'S REPUBLIC OF CHINA CONCERNING THEADMINISTRATION OF TAX COLLECTION
THE LAW OF THE PEOPLE'S REPUBLIC OF CHINA CONCERNING THEADMINISTRATION OF TAX COLLECTION
(Standing Committee, National People's Congress: 4 September 1992)
Whole Doc.
CHAPTER 1 CENTRAL PROVISIONS
Article 1
This law has been formulated with a view to strengthening the
administration of tax collection, guaranteeing the tax revenue of the
State and safeguarding the legitimate rights and interests of the
taxpayers.
Article 2
This Law shall apply to the administration of tax collection in
respect of all taxes collected by the tax authorities in accordance with
tax laws.
Article 3
The collection of tax or the cessation thereof, the reduction,
exemption and refund of tax as well as the payment of tax underpaid shall
be implemented in accordance with the law or the relevant provisions
stipulated in administrative regulations formulated by the State Council,
provided that the State Council is authorized by the law to formulate the
relevant provisions.
No governmental organs, entities or individuals may be permitted to
make decisions without authorization regarding the collection of tax or
the cessation there of, the reduction, exemption or refund of tax, or the
payment of tax underpaid in violation of the law or the administrative
regulations.
Article 4
Entities or individuals which are obligated to pay tax in accordance
with the law or the administrative regulations are the taxpayers.
Entities or individuals which are obligated to withhold and remit tax
or collect and remit tax in accordance with the law or the administrative
regulations are the withholding agents.
Taxpayers or withholding agents must pay tax, or withhold and remit
tax or collect and remit tax in accordance with the law or the
administrative regulations.
Article 5
The competent tax departments under the State Council shall be in
charge of the administration of tax collection for the whole country.
The local people's governments at various levels shall strengthen
their leadership in the administration of tax collection within their
jurisdictions and support the tax authorities in carrying out their duties
and accomplishing their tasks of tax collection in accordance with the
law.
The various departments and entities concerned shall support and
assist the tax authorities in carrying out their duties in accordance with
the law.
No entities or individuals shall impede the tax authorities from
carrying out their duties in accordance with the law.
Article 6
Tax officials must implement the law impartially and devote
themselves to their duties. They shall not extort or take bribes, practice
favouritism, commit malpractice, neglect their duties, or fail to collect
or undercollect the amount of tax payable. Nor shall they abuse their
powers to overcollect tax or deliberately create difficulties for
taxpayers and withholding agents.
Article 7
Any entity or individual shall have the right to report any acts
committed in violation of the law or the administrative regulations. The
tax authorities shall maintain confidentiality in respect of the
informants and grant them rewards in accordance with the relevant
provisions.
Article 8
The "tax authorities" referred to in this Law means the tax bureaux
at various levels and their subbureaux and tax stations.
CHAPTER II-TAX ADMINISTRATION
SECTION 1 -TAX REGISTRATION
Article 9
Enterprises, branches in other jurisdictions established by the
enterprises, sites engaged in production or business operations,
individual households engaged in industry and commerce as well as
institutions engaged in production or business operations (hereinafter
collectively referred to as "taxpayers engaged in production or business
operations") shall, within 30 days after the receipt of a business
licence, report to and complete tax registration formalities with the tax
authorities on presentation of the relevant supporting documents. Upon
examination and verification of the supporting documents, the tax
authorities shall issue tax registration certificates.
The scope and methods for tax registration formalities which shall be
carried out by taxpayers other than those as prescribed in the preceding
Paragraph shall be formulated by the State Council.
Article 10
Where a change occurs in the contents of tax registration of a
taxpayer engaged in production or business operations, the taxpayer
concerned shall, within 30 days after the date of completing the
formalities for such change in the business registration with the
Administration for Industry and Commerce or prior to the submission of an
application for cancellation of business registration to the
Administration for Industry and Commerce, report to and complete the
formalities for the change or cancellation of tax registration with the
tax authorities on presentation of the relevant supporting documents.
Article 11
Taxpayers shall use tax registration certificates in accordance with
the rulings formulated by the competent tax departments under the State
Council. The tax registration certificates shall not be lent, altered,
damaged, traded or forged.
SECTION 2- ADMINISTRATION OF ACCOUNTING BOOKS AND SUPPORTINGVOUCHERS
Article 12
Taxpayers engaged in production or business operations or withholding
agents shall establish accounting books in accordance with the rulings
formulated by the authorized fiscal or tax department under the State
Council, keep records based on legitimate and valid vouchers and conduct
accounting. Individual households, engaged in industry and commerce which
are indeed unable to keep accounting books may keep no accounting books
after approval by the tax authorities.
Article 13
The financial and accounting systems or methods of a taxpayer engaged
in production or business operations shall be submitted to the tax
authorities for their records.
Where the financial and accounting systems or methods of a taxpayer
engaged in production or business operations are contradictory to the
relevant tax rules formulated by the State Council or the authorized
fiscal or tax departments under the State Council, the calculation and
payment of tax shall be conducted in accordance with the relevant tax
rules formulated by the State Council or the authorized fiscal or tax
departments under the State Council.
Article 14
Invoices must be printed by enterprises designated by the authorized
tax departments of the people's governments of the provinces, autonomous
regions and municipalities directly under the Central Government. No
enterprises are permitted to print invoices without authorization by the
competent tax departments of the people's governments of the provinces,
autonomous regions and municipalities directly under the Central
Government.
The measures regarding the administration of invoices shall be
formulated by the State Council.
Article 15
Taxpayers engaged in production or business operations or withholding
agents must maintain accounting books, supporting vouchers for the
accounts, tax payment receipts and other relevant information within the
period prescribed by the authorized fiscal or tax departments under the
State Council.
Accounting books, supporting vouchers for the accounts, tax payment
receipts and other relevant information shall not be forged, revised or
damaged without approval.
SECTION 3- FILING TAX RETURNS
Article 16
Taxpayers must fulfil tax filing requirements, submit tax returns,
financial and accounting statements as well as the relevant information on
tax payments required by the tax authorities based on practical needs
within the time limit for tax reporting prescribed in the law or the
administrative regulations, or as determined by the tax authorities in
accordance with the law or the administrative regulations.
Withholding agents must submit reporting schedules on taxes withheld
and remitted or collected and remitted as well as other relevant
information required by the tax authorities to be submitted by the
withholding agents based on practical needs within the time limit for tax
reporting prescribed in the law or the administrative regulations, or as
determined by the tax authorities in accordance with the law or the
administrative regulations.
Article 17
Where a taxpayer or withholding agent is unable to file tax returns
or to submit reporting schedules on the tax withheld and remitted or
collected and remitted within the prescribed time limit, it may, upon
examination and approval by the tax authorities, extend the time to file
the tax returns or submit the reporting schedules.
CHAPTER III-TAX COLLECTION
Article 18
The tax authorities shall collect tax in accordance with the law or
the administrative regulations. They shall not collect, cease to collect,
overcollect or undercollect tax in violation of the law or the
administrative regulations.
Article 19
Withholding agents shall fulfil their obligations of withholding or
collecting tax in accordance with the law or the administrative
regulations. The tax authorities shall not impose any tax withholding or
collection requirements on entities and individuals which are not
obligated to withhold or collect tax in accordance with the law or the
administrative regulations.
A taxpayer shall not prevent a withholding agent from fulfilling its
obligations of withholding or collecting tax in accordance with the law.
In the event that the taxpayer prevents a withholding agent from
fulfilling its obligations, the withholding agent shall promptly report
the case to the tax authorities for their action.
The tax authorities shall pay a handling fee to withholding agents
for withholding or collecting tax in accordance with the relevant
provisions.
Article 20
A taxpayer or withholding agent shall pay or remit tax within the
time limit prescribed by the law or the administrative regulations, or as
determined by the tax authorities in accordance with the law or the
administrative regulations. Where a taxpayer is unable to pay tax within
the prescribed time limit as a result of encountering special
difficulties, it may, upon approval of a tax bureau (or a subbureau
thereof) above the county level, defer the payment of tax for a period of
not more than three months.
Where a taxpayer fails to pay tax within the time limit as prescribed
in the preceding Paragraph or a withholding agent fails to remit tax
within the time limit as prescribed in the preceding Paragraph, the tax
authorities shall, in addition to ordering the taxpayer or withholding
agent to pay or remit the tax within the prescribed time limit, impose a
fine on a daily basis at the rate of 0.2% of the amount of tax in arrears,
commencing on the day the tax payment is in default.
Article 21
A taxpayer may submit a written application for tax reduction or
exemption to the tax authorities in accordance with the law or the
administrative regulations.
Applications for tax reduction or exemption shall be examined and
approved by the authorities designated for examination and approval of tax
reduction or exemption as prescribed in the law or the administrative
regulations. The decisions on tax reduction or exemption made by the
people's governments at various local levels, the competent departments of
the people's governments at various levels, entities or individuals
without authorization in violation of the law or the administrative
regulations shall be null and void.
Article 22
When the tax authorities collect tax payments and the tax withheld or
collected by withholding agents, tax payment receipts must be issued to
the taxpayers.
Article 23
In the event that one of the following circumstances should arise in
respect of a taxpayer, the tax authorities shall have the right to assess
the amount of tax payable by the taxpayer:
(1) accounting books are, in accordance with this Law, not kept;
(2) accounting books are required to be kept by this Law but have not
been kept;
(3) although accounting books have been kept, the accounting entries
have not been entered in an appropriate manner or the information on
costs, receipt vouchers and expense vouchers are incomplete, causing
difficulties in conducting an audit.
(4) a taxpayer who is obligated to pay tax fails to go through tax
filing procedures within a prescribed time limit and, after having been
ordered by the tax authorities to file tax returns within the prescribed
time limit, still fails to file the tax returns within the prescribed time
limit.
Article 24
The receipt or payment of charges or fees in business transactions
between an enterprise or institutions or sites engaged in production or
business operations established in China by a foreign enterprise, and its
associated enterprises, shall be made at arm's length prices. Where the
receipt or payment of charges or fees is not made at arm's length prices
and results in a reduction of the taxable income, the tax authorities
shall have the right to make reasonable adjustments.
Article 25
Where an entity or individual engages in business operations without
a business licence, the case shall be handled by the Administration for
Industry and Commerce in accordance with the law. In addition, the tax
authorities shall assess the amount of tax payable by the entity or
individual and order the same to make the tax payments. Should the entity
or individual refuse to make the tax payments, the tax authorities may
impound commodities or goods, the value of which is equivalent to the
amount of tax payable. If the amount of tax payable is paid after the
goods or commodities have been impounded, the tax authorities must
immediately remove the lien and return the impounded commodities or goods
to the entity or individual. If the amount of tax payable is still not
paid after the impound, the commodities or goods which have been impounded
may, upon approval of the commissioner of a tax bureau (or a subbureau
there of) above the county level, be sold by auction and the proceeds from
the auction may be used to make good the amount of tax payable.
Article 26
Where the tax authorities have grounds for deeming that a taxpayer
engaged in production or business operations has evaded taxes, the tax
authorities may, prior to the prescribed date of the tax payment, order
the taxpayer to pay the tax payable within the prescribed time limit. In
the event that the tax authorities discover that there are evidences that
the taxpayer has transferred or concealed its taxable commodities, goods
and other property, or taxable income within the prescribed time limit,
the tax authorities may order the taxpayer to provide a guaranty for tax
payment. If the taxpayer is unable to provide a guaranty for tax payment,
the tax authorities may, upon approval of the commissioner of a tax bureau
(or a subbureau there of) above the county level, implement the following
measures for retaining tax revenue:
(1) notify in writing the banks or other financial institutions with
which the taxpayer has opened an account to stop payment from the
taxpayer's deposits of an amount equivalent to the amount of tax payable
on a temporary basis.
(2) impound or seal up the taxpayer's taxable commodities, goods or
other property, the value of which is equivalent to the amount of tax
payable.
In the event that the taxpayer makes the tax payments within the time
limit as prescribed in the preceding Paragraph, the tax authorities must
immediately lift the conditions for retaining tax revenue. Should the
taxpayer fail to make the tax payments at the expiration of the time
limit, the tax authorities may, upon approval of the commissioner of a tax
bureau (or a subbureau thereof) above the county level, notify in writing
the banks or other financial institutions with which the taxpayer has
opened an account to withhold and remit the amount of tax from the
taxpayer's deposits from which payment has been stopped on a temporary
basis, or sell by auction the commodities, goods or property which have
been impounded and use the proceeds from the auction to make good the
amount of tax payable.
Where the legitimate interests of a taxpayer are jeopardised due to
the implementation of inappropriate measures for retaining tax revenue or
to the failure on the part of the tax authorities to lift the measures for
retaining tax revenue immediately after the taxpayer has made the tax
payments within the prescribed time limit, the tax authorities shall
assume compensation responsibility for damages.
Article 27
Where a taxpayer engaged in production or business operations or a
withholding agent fails to pay or remit tax within the prescribed time
limit, or a tax payment guarantor fails to pay the guaranteed amount of
tax within the prescribed time limit, the tax authorities shall order them
to pay the tax within a prescribed time limit. In the case of failure to
pay the tax within the prescribed time limit, the tax authorities may,
upon approval of the commissioner of a tax bureau (or a subbureau there
of) above the county level, implement the following mandatory enforcement
measures:
(1) notify in writing the banks or other financial institutions with
which the taxpayer, withholding agent or tax payment guarantor has opened
an account to withhold and remit the amount of tax from its deposits.
(2) impound, seal up or sell by auction the commodities, goods, or
other property of the taxpayer, withholding agent or tax payment
guarantor, the value of which is equivalent to the amount of tax payable,
and to use the proceeds from the auction to make good the amount of tax
payable.
At the same time as implementing the mandatory measures, the tax
authorities shall implement the relevant mandatory measures to collect the
fine on tax in arrears which has not been paid by the taxpayer,
withholding agent or tax payment guarantor.
Article 28
Should a taxpayer who has not paid the amount of tax payable need to
leave China, it shall settle the amount of tax payable or provide a
guaranty to the tax authorities before leaving the country. If the
taxpayer neither settles the amount of tax payable nor provides a
guaranty, the tax authorities may notify the authorities responsible for
exit to prevent the taxpayer from leaving the country.
Article 29
When impounding commodities, goods or other property, the tax
authorities must issue a receipt for the items impounded. When sealing up
commodities, goods or other property, the tax authorities must write out a
list of these items.
Article 30
After determining that a taxpayer has paid an amount of tax in excess
of the tax payable, the tax authorities shall immediately refund the
excess amount to the taxpayer. Where a taxpayer discovers that it has
paid an amount of tax in excess of the tax payable within three years from
the date the tax payment has been made, it may claim a refund of the
excess amount of tax from the tax authorities. Upon examination and
verification of the case, the tax authorities shall immediately refund the
excess amount of tax.
Article 31
Should a taxpayer or withholding agent fail to pay tax or underpay
tax as a result of the responsibilities of the tax authorities, the tax
authorities may, within three years, require the taxpayer or withholding
agent to pay the tax in arrears, but they shall not impose any fine on the
tax in arrears.
Should a taxpayer or withholding agent fail to pay tax or underpay
tax through its own faults, such as making an erroneous calculation, the
tax authorities may, within three years, pursue the collection of the tax
in arrears. If special circumstances exist, the period for pursuing the
collection of the tax in arrears may be extended to ten years.
CHAPTER IV-TAX INSPECTION
Article 32
The tax authorities shall have the right to conduct tax
inspection as follows:
(1) to inspect a taxpayer's accounting books, supporting vouchers for
the accounts, statements and the relevant information; to inspect a
withholding agent's accounting books, supporting vouchers for the accounts
and the relevant information in respect of the amount of tax withheld and
remitted or collected and remitted.
(2) to inspect a taxpayer's taxable commodities, goods or other
property at the taxpayer's places where production or business operations
are conducted and places where goods are stored; to inspect a withholding
agent's operational conditions in respect of the withholding and
remittance of tax or the collection and remittance of tax.
(3) to order a taxpayer or withholding agent to furnish documents,
evidentiary materials and information pertaining to the payment of tax or
the amount of tax withheld and remitted or collected and remitted.
(4) to make inquiries of a taxpayer or withholding agent regarding
the relevant issues and circumstances connected with the payment of tax or
the amount of tax withheld and remitted or collected and remitted.
(5) to inspect supporting documents, vouchers and information
pertaining to the taxable commodities, goods or other property transported
by consignment or sent by post by a taxpayer at railway stations, docks,
airports, enterprises engaged in postal services and the branches thereof.
(6) upon approval of the commissioner of a tax bureau (or a subbureau
thereof) above the county level, to examine and verify the deposit
accounts that a taxpayer engaged in production or business operations or a
withholding agent has opened with banks or other financial institutions,
on presentation of a permit for the inspection of deposit accounts which
is of a nationally unified form; to examine and verify the savings
deposits of a taxpayer engaged in production or business operations,
provided, however, that the saving deposits have been subject to the
verification of the regional office of a county or municipal subbranch or
municipal branch of a bank and such regional office has designated a
savings section thereof to provide the relevant information.
Article 33
A taxpayer or withholding agent must subject itself to the tax
inspection conducted by the tax authorities in accordance with the law,
report the circumstances accurately and provide the relevant information,
and shall not refuse to cooperate or conceal any facts.
Article 34
When the tax authorities conduct tax inspection in accordance with
the law, the relevant departments and units shall provide support and
assistance and accurately report the circumstances of taxpayers,
withholding agents and other parties concerned in respect of the payment
of tax and the amount of tax withheld and remitted or collected and
remitted, and furnish the relevant information and evidentiary materials.
Article 35
When investigating a tax case in violation of the law, the tax
authorities may record, tape-record, video-tape, photograph and reproduce
the relevant circumstances and information in respect of the case.
Article 36
When conducting tax inspection, the officials sent by the tax
authorities shall produce tax inspection identity cards and shall be
responsible for maintaining confidentiality for the persons under
investigation.
CHAPTER V-LEGAL LIABILITIES
Article 37
The tax authorities shall order a taxpayer to remedy any of the
following acts committed by the taxpayer within a time limit. Should the
taxpayer fail to remedy it within the time limit, the tax authorities may
impose a fine of not more than Renminbi 2000 Yuan on the taxpayer. If the
case is serious, the tax authorities may impose a fine of an amount from
Renminbi 2000 Yuan to Renminbi 10000 Yuan on the taxpayer.
(1) failure to apply for tax registration, change or cancellation of
tax registration within a prescribed time limit;
(2) failure to keep or maintain accounting books, or maintain
supporting vouchers for the accounts and the relevant information in
accordance with the relevant provisions;
(3) failure to furnish reports on the financial and accounting
systems or the financial and accounting methods to the tax authorities for
possible reference use in accordance with the relevant provisions.
Article 38
Where a withholding agent fails to keep and maintain accounting books
for the tax withheld and remitted or collected and remitted, or to
maintain supporting vouchers for the accounts and the relevant information
in respect of the tax withheld and remitted or collected and remitted in
accordance with the relevant provisions, the tax authorities shall order
the withholding agent to remedy the situation within a time limit. Should
the withholding agent fail to remedy the situation within the time limit,
the tax authorities may impose a fine of not more than Renminbi 2000 Yuan
on the withholding agent. If the case is serious, the tax authorities may
impose a fine of an amount from Renminbi 2000 Yuan to Renminbi 5000 Yuan
on the withholding agent.
Article 39
Where a taxpayer fails to fulfil tax filing requirements within a
prescribed time limit or a withholding agent fails to furnish reporting
schedules on the tax withheld and remitted or collected and remitted to
the tax authorities within a prescribed time limit, the tax authorities
shall order the taxpayer or withholding agent to remedy the situation
within the prescribed time limit and may impose a fine of not more than
Renminbi 2000 Yuan on the taxpayer or withholding agent. Should the
taxpayer or withholding agent fail to remedy the situation within the
prescribed time limit, the tax authorities may impose a fine of over
Renminbi 2000 Yuan but under Renminbi 10000 Yuan on the taxpayer or
withholding agent.
Article 40
"Evasion of tax" means that a taxpayer fails to pay or underpays the
amount of tax payable through the adoption of the means of forging,
revising, concealing or destroying without authorization accounting books
or supporting vouchers for the accounts, or of overstating expenses or not
stating or understating income in accounting books, or of filing
fraudulent tax returns. Where the amount of tax evaded accounts for more
than ten percent of the amount of tax payable and is over Renminbi 10000
Yuan, or where the taxpayer evades tax again after having been subject to
administrative punishment imposed by the tax authorities twice as a result
of tax evasion, the tax authorities shall, in addition to pursuing the
payment of tax which has been evaded by the taxpayer, impose a punishment
on the taxpayer in accordance with the provisions set forth in Article 1
of the Supplementary Provisions Concerning the Imposition of Punishment in
Respect of Offenses of Evasion of Tax and Refusal to Pay Tax. Where the
amount of tax evaded is under Renminbi 10000 Yuan or accounts for not more
than ten percent of the amount of tax payable, the tax authorities shall
pursue the payment of the tax evaded and impose a fine of not more than
five times the amount of tax evaded.
Where a withholding agent fails to pay or underpays the tax which has
been withheld or collected through the adoption of the means as specified
in the preceding Paragraph, and where the amount of tax evaded accounts
for more than ten percent of the amount of tax payable and is over
Renminbi 10000 Yuan, a punishment shall be imposed on the withholding
agent in accordance with the provisions stipulated in Article 1 of the
Supplementary Provisions Concerning the Imposition of Punishment in
Respect of Offenses of Evasion of Tax and Refusal to Pay Tax. Where the
amount of tax evaded is under Renminbi 10000 Yuan or accounts for not more
than ten percent of the amount of tax payable, the tax authorities shall
pursue the payment of the amount of tax the withholding agent has failed
to pay or underpaid and impose a fine of not more than five times the
amount of tax which has not been paid or underpaid.
Article 41
Where a taxpayer who has failed to pay the amount of tax payable by
means of transferring or concealing the property, resulting in failure on
the part of the tax authorities to pursue the payment of the tax
underpaid, and where the amount of the tax underpaid is over Renminbi
10000 Yuan, the tax authorities shall, in addition to pursuing the payment
of the tax underpaid, impose a punishment on the taxpayer in accordance
with the provisions set forth in Article 2 of the Supplementary Provisions
Concerning the Imposition of Punishment in Respect of Offenses of Evasion
of Tax and Refusal to Pay Tax. Where the amount of tax underpaid is under
Renminbi 10000 Yuan, the tax authorities shall pursue the payment of the
tax underpaid, and impose a fine of not more than five times the amount of
tax underpaid.
Article 42
Where an enterprise or institution commits an illegal act as
specified in Article 40 and 41 of this Law and such act constitutes an
offence, a punishment shall be imposed in accordance with the provisions
set forth in Article 3 of the Supplementary Provisions Concerning the
Imposition of Punishment in Respect of Offenses of Evasion of Tax and
Refusal to Pay Tax. Where such act does not constitute an offence, the tax
authorities shall pursue the payment of the amount of tax the enterprise
or institution has failed to pay or underpaid, and impose a fine of not
more than five times the amount of tax which has not been paid or
underpaid.
Article 43
Where a taxpayer fails to pay or underpays the amount of tax payable
by offering a bribe to tax officials, a punishment shall be imposed in
accordance with the provisions set forth in Article 4 of the Supplementary
Provisions Concerning the Imposition of Punishment in Respect of Offenses
of Evasion of Tax and Refusal to Pay Tax.
Article 44
Where an enterprise or institution fraudulently obtains tax refund
for export from the State through the adoption of deceptive means such as
fraudulently declaring the commodities it produces or operates as export
goods, and where the amount of tax refund which has been fraudulently
obtained is over Renminbi 10000 Yuan, the tax authorities shall, in
addition to pursuing the repayment of the tax refund the enterprise or
institution has fraudulently obtained, impose a punishment in accordance
with the provisions set forth in Paragraph 1 of Article 5 of the
Supplementary Provisions Concerning the imposition of Punishment in
Respect of Offenses of Evasion of Tax and Refusal to Pay Tax. Where the
amount of tax refund for export which has been fraudulently obtained from
the State is under Renminbi 10000 Yuan, the tax authorities shall pursue
the repayment of the tax refund the enterprise or institution has
fraudulently obtained, and impose a fine of not more than five times the
amount of tax refund which has been fraudulently obtained.
Where an entity or individual other than those as prescribed in the
preceding Paragraph fraudulently obtains tax refund for export from the
State, the tax authorities shall, in addition to pursuing the repayment of
the tax refund the entity or individual has fraudulently obtained, impose
a punishment on the entity or individual in accordance with the provisions
stipulated in Paragraph 2 of Article 5 of the Supplementary Provisions
Concerning the Imposition of Punishment in Respect of Offenses of Evasion
of Tax and Refusal to Pay Tax. Where the amount of tax refund which has
been fraudulently obtained is so small as not to constitute an offence,
the tax authorities shall pursue the repayment of the tax refund the
entity or individual has fraudulently obtained, and impose a fine of not
more than five times the amount of tax refund which has been fraudulently
obtained.
Article 45
In the case of refusal to pay tax, which means the refusal to pay tax
by using violence or menace, the tax authorities shall, in addition to
pursuing the payment of the amount of tax a taxpayer has refused to pay,
impose a punishment on the taxpayer in accordance with the provisions set
forth in Paragraph 1 of Article 6 of the Supplementary Provisions
Concerning the Imposition of Punishment in Respect of Offenses of Evasion
of Tax and Refusal to Pay Tax. Where the case is so trivial that no
offence has been committed, the tax authorities shall pursue the payment
of the amount of tax the taxpayer has refused to pay, and impose a fine of
not more than five times the amount of tax the taxpayer has refused to
pay.
In the case of refusal to pay tax by using violence which causes a
person to suffer from serious injury or death, a heavy penalty shall be
imposed as that on an offence of assault or manslaughter, and a fine shall
be imposed in accordance with the provisions set forth in Paragraph 2 of
Article 6 of the Supplementary Provisions Concerning the Imposition of
Punishment in Respect of Offenses of Evasion of Tax and Refusal to Pay
Tax.
Article 46
Where a taxpayer engaged in production or business operations or a
withholding agent which has been ordered by the tax authorities to pay,
within a time limit, the amount of tax which should be paid or remitted
but has not been paid or underpaid within a prescribed time limit, fails
to pay the amount of tax within the time limit, the tax authorities may,
in addition to pursuing the payment of the amount of tax the taxpayer or
withholding agent has failed to pay or underpaid through the adoption of
the mandatory measures as prescribed in Article 27 of this Law, impose a
fine of not more than five times the amount of tax which has not been paid
or underpaid.
Article 47
A withholding agent which fails to withhold or collect the amount of
tax which should have been withheld or collected shall pay the amount of
tax which should have been withheld or collected but has not been withheld
or collected, except in the case where the withholding agent has promptly
reported to the tax authorities the situation regarding the refusal on the
part of a taxpayer to have the amount of tax withheld or collected.
Article 48
Where invoices are printed illegally in violation of the provisions
stipulated in Article 14 of this Law, the tax authorities shall destroy
the invoices which have been illegally printed, confiscate the illicit
gains, and impose a fine.
Article 49
The administrative punishment as prescribed in this Law shall be
decided by a tax bureau (or a subbureau thereof) above the county level.
Where a fine of not more than Renminbi 1000 Yuan is imposed on an
individual household engaged in industry and commerce or an entity or
individual which conducts business operations without a business licence,
the decision shall be made by the tax station concerned.
Upon receipt of a fine, the tax authorities shall issue a receipt.
Article 50
Where violence or menace is used to obstruct tax officials from
performing their duties in accordance with the law, criminal liabilities
shall be pursued in accordance with the provisions set forth in Article
157 of the Criminal Law. Where tax officials are refused or obstructed
from performing their duties in accordance with the law but no violence or
menace has been used, a punishment shall be imposed by the public security
authorities pursuant to the provisions stipulated in the Law Concerning
the Administration of Public Security and Punishments.
Article 51
The People's Courts and the tax authorities shall turn over the gains
from fines and confiscations they have received to the state treasury.
Article 52
Where tax officials collude with taxpayers or withholding agents, or
instigate or assist the same to commit the offenses specified in Article
40, 41, 42 and 44 of this Law, a punishment shall be imposed in accordance
with the provisions regarding joint offenses stipulated in the Criminal
Law. Where no offence is committed, administrative punishment shall be
imposed.
Article 53
Where tax officials take advantage of their positions and powers to
accept or extort the property of taxpayers or withholding agents, and such
acts constitute an offence, criminal liabilities of the tax officials
shall be investigated based on an offence of bribery. Where such acts do
not constitute an offence, administrative sanctions shall be imposed on
the tax officials.
Article 54
Where tax officials neglect their duties and fail to collect or
undercollect the correct amount of tax, causing enormous losses in the tax
revenue of the State, criminal liabilities of the tax officials shall be
investigated in accordance with the provisions set forth in Article 187 of
the Criminal Law. Where such acts do not constitute an offence,
administrative sanctions shall be imposed on the tax officials.
Tax officials who abuse their powers and deliberately create
difficulties for taxpayers and withholding agents shall be subject to
administrative sanctions.
Article 55
Where decisions regarding the collection of tax or the cessation
thereof, the reduction, exemption or refund of tax, or the payment of tax
underpaid have been made without authorization in violation of the law or
the administrative regulations, the decisions so made shall be revoked in
accordance with this Law. In addition, the amount of tax underpaid shall
be collected and the amount of tax overcollected shall be refunded. The
administrative liabilities of the officials directly responsible shall
also be investigated by the authorities at a higher level.
Article 56
In the case of tax disputes with the tax authorities, a taxpayer,
withholding agent or tax payment guarantor must first pay or remit the
amount of tax and fines on tax in arrears in accordance with the law or
the administrative regulations, and there after may, within 60 days from
the date of receipt of a payment receipt from the tax authorities, apply
to the tax authorities at a higher level for reconsideration. The tax
authorities at a higher level shall, within 60 days from the date of
receipt of the application for reconsideration, make a decision after
reconsideration. In the case of objection to the decision made after
reconsideration, legal proceedings may be instituted with the People's
Court within 15 days from the date of receipt of the decision made after
reconsideration.
Where a party concerned objects to a sanction decision made by the
tax authorities or to the mandatory measures or measures for retaining tax
revenue implemented by the same, it may, within 15 days from the date of
receipt of the sanction notice or the date the tax authorities implement
the mandatory measures or measures for retaining tax revenue, apply for a
reconsideration to the authorities one level higher than the authorities
which have made the sanction decision or implemented the mandatory
measures or measures for retaining tax revenue. If the party concerned
objects to the decision made upon reconsideration, it may, within 15 days
from the date of receipt of the reconsideration decision, institute legal
proceedings with the People's Court. Alternatively, the party concerned
may, within 15 days from the date of receipt of the sanction notice or the
date the tax authorities implement the mandatory measures or measures for
retaining tax revenue, institute legal proceedings directly with the
People's Court. In the course of making a reconsideration and instituting
legal proceedings, the mandatory measures or measures for retaining tax
revenue shall not cease to be implemented.
If the party concerned neither applies for a reconsideration of the
sanction decision made by the tax authorities and institutes legal
proceedings with the People's Court within the prescribed time limit nor
complies with the sanction decision, the tax authorities which have made
the sanction decision may apply to the People's Court for mandatory
enforcement of the decision.
CHAPTER VI-SUPPLEMENTARY PROVISIONS
Article 57
A taxpayer or withholding agent may appoint a tax agent to handle its
tax matters on its behalf.
Article 58
The administration of collection of agricultural tax, animal
husbandry tax, cultivated land usage tax and deed tax shall be implemented
with reference to the relevant provisions of this Law. The administration
of collection of customs duty, shipping tax and taxes collected by the
Customs on behalf of the tax authorities shall be implemented in
accordance with the relevant provisions stipulated in the law or the
administrative regulations.
Article 59
In the case of a discrepancy between the provisions of the relevant
tax treaties or agreements concluded between the People's Republic of
China and foreign countries and the provisions of this Law, the relevant
matters shall be handled in accordance with the treaties or agreements.
Article 60
In the case of a discrepancy between the provisions of the tax laws
promulgated prior to the implementation of this Law and the provisions of
this Law, the provisions of this Law shall apply.
Article 61
The detailed rules and regulations for the implementation of this Law
shall be formulated by the State Council in accordance with this Law.
Article 62
This Law shall come into force as of January 1, 1993. The "Interim
Provisions of the People's Republic of China Concerning the Administration
of Tax Collection" promulgated by the State Council on April 21, 1986
shall be superseded at the same time.
ils to furnish reporting
schedules on the tax withheld and remitted or collected and remitted to
the tax authorities within a prescribed time limit, the tax authorities
shall order the taxpayer or withholding agent to remedy the situation
within the prescribed time limit and may impose a fine of not more than
Renminbi 2000 Yuan on the taxpayer or withholding agent. Should the
taxpayer or withholding agent fail to remedy the situation within the
prescribed time limit, the tax authorities may impose a fine of over
Renminbi 2000 Yuan but under Renminbi 10000 Yuan on the taxpayer or
withholding agent.
Article 40
"Evasion of tax" means that a taxpayer fails to pay or underpays the
amount of tax payable through the adoption of the means of forging,
revising, concealing or destroying without authorization accounting books
or supporting vouchers for the accounts, or of overstating expenses or not
stating or understating income in accounting books, or of filing
fraudulent tax returns. Where the amount of tax evaded accounts for more
than ten percent of the amount of tax payable and is over Renminbi 10000
Yuan, or where the taxpayer evades tax again after having been subject to
administrative punishment imposed by the tax authorities twice as a result
of tax evasion, the tax authorities shall, in addition to pursuing the
payment of tax which has been evaded by the taxpayer, impose a punishment
on the taxpayer in accordance with the provisions set forth in Article 1
of the Supplementary Provisions Concerning the Imposition of Punishment in
Respect of Offenses of Evasion of Tax and Refusal to Pay Tax. Where the
amount of tax evaded is under Renminbi 10000 Yuan or accounts for not more
than ten percent of the amount of tax payable, the tax authorities shall
pursue the payment of the tax evaded and impose a fine of not more than
five times the amount of tax evaded.
Where a withholding agent fails to pay or underpays the tax which has
been withheld or collected through the adoption of the means as specified
in the preceding Paragraph, and where the amount of tax evaded accounts
for more than ten percent of the amount of tax payable and is over
Renminbi 10000 Yuan, a punishment shall be imposed on the withholding
agent in accordance with the provisions stipulated in Article 1 of the
Supplementary Provisions Concerning the Imposition of Punishment in
Respect of Offenses of Evasion of Tax and Refusal to Pay Tax. Where the
amount of tax evaded is under Renminbi 10000 Yuan or accounts for not more
than ten percent of the amount of tax payable, the tax authorities shall
pursue the payment of the amount of tax the withholding agent has failed
to pay or underpaid and impose a fine of not more than five times the
amount of tax which has not been paid or underpaid.
Article 41
Where a taxpayer who has failed to pay the amount of tax payable by
means of transferring or concealing the property, resulting in failure on
the part of the tax authorities to pursue the payment of the tax
underpaid, and where the amount of the tax underpaid is over Renminbi
10000 Yuan, the tax authorities shall, in addition to pursuing the payment
of the tax underpaid, impose a punishment on the taxpayer in accordance
with the provisions set forth in Article 2 of the Supplementary Provisions
Concerning the Imposition of Punishment in Respect of Offenses of Evasion
of Tax and Refusal to Pay Tax. Where the amount of tax underpaid is under
Renminbi 10000 Yuan, the tax authorities shall pursue the payment of the
tax underpaid, and impose a fine of not more than five times the amount of
tax underpaid.
Article 42
Where an enterprise or institution commits an illegal act as
specified in Article 40 and 41 of this Law and such act constitutes an
offence, a punishment shall be imposed in accordance with the provisions
set forth in Article 3 of the Supplementary Provisions Concerning the
Imposition of Punishment in Respect of Offenses of Evasion of Tax and
Refusal to Pay Tax. Where such act does not constitute an offence, the tax
authorities shall pursue the payment of the amount of tax the enterprise
or institution has failed to pay or underpaid, and impose a fine of not
more than five times the amount of tax which has not been paid or
underpaid.
Article 43
Where a taxpayer fails to pay or underpays the amount of tax payable
by offering a bribe to tax officials, a punishment shall be imposed in
accordance with the provisions set forth in Article 4 of the Supplementary
Provisions Concerning the Imposition of Punishment in Respect of Offenses
of Evasion of Tax and Refusal to Pay Tax.
Article 44
Where an enterprise or institution fraudulently obtains tax refund
for export from the State through the adoption of deceptive means such as
fraudulently declaring the commodities it produces or operates as export
goods, and where the amount of tax refund which has been fraudulently
obtained is over Renminbi 10000 Yuan, the tax authorities shall, in
addition to pursuing the repayment of the tax refund the enterprise or
institution has fraudulently obtained, impose a punishment in accordance
with the provisions set forth in Paragraph 1 of Article 5 of the
Supplementary Provisions Concerning the imposition of Punishment in
Respect of Offenses of Evasion of Tax and Refusal to Pay Tax. Where the
amount of tax refund for export which has been fraudulently obtained from
the State is under Renminbi 10000 Yuan, the tax authorities shall pursue
the repayment of the tax refund the enterprise or institution has
fraudulently obtained, and impose a fine of not more than five times the
amount of tax refund which has been fraudulently obtained.
Where an entity or individual other than those as prescribed in the
preceding Paragraph fraudulently obtains tax refund for export from the
State, the tax authorities shall, in addition to pursuing the repayment of
the tax refund the entity or individual has fraudulently obtained, impose
a punishment on the entity or individual in accordance with the provisions
stipulated in Paragraph 2 of Article 5 of the Supplementary Provisions
Concerning the Imposition of Punishment in Respect of Offenses of Evasion
of Tax and Refusal to Pay Tax. Where the amount of tax refund which has
been fraudulently obtained is so small as not to constitute an offence,
the tax authorities shall pursue the repayment of the tax refund the
entity or individual has fraudulently obtained, and impose a fine of not
more than five times the amount of tax refund which has been fraudulently
obtained.
Article 45
In the case of refusal to pay tax, which means the refusal to pay tax
by using violence or menace, the tax authorities shall, in addition to
pursuing the payment of the amount of tax a taxpayer has refused to pay,
impose a punishment on the taxpayer in accordance with the provisions set
forth in Paragraph 1 of Article 6 of the Supplementary Provisions
Concerning the Imposition of Punishment in Respect of Offenses of Evasion
of Tax and Refusal to Pay Tax. Where the case is so trivial that no
offence has been committed, the tax authorities shall pursue the payment
of the amount of tax the taxpayer has refused to pay, and impose a fine of
not more than five times the amount of tax the taxpayer has refused to
pay.
In the case of refusal to pay tax by using violence which causes a
person to suffer from serious injury or death, a heavy penalty shall be
imposed as that on an offence of assault or manslaughter, and a fine shall
be imposed in accordance with the provisions set forth in Paragraph 2 of
Article 6 of the Supplementary Provisions Concerning the Imposition of
Punishment in Respect of Offenses of Evasion of Tax and Refusal to Pay
Tax.
Article 46
Where a taxpayer engaged in production or business operations or a
withholding agent which has been ordered by the tax authorities to pay,
within a time limit, the amount of tax which should be paid or remitted
but has not been paid or underpaid within a prescribed time limit, fails
to pay the amount of tax within the time limit, the tax authorities may,
in addition to pursuing the payment of the amount of tax the taxpayer or
withholding agent has failed to pay or underpaid through the adoption of
the mandatory measures as prescribed in Article 27 of this Law, impose a
fine of not more than five times the amount of tax which has not been paid
or underpaid.
Article 47
A withholding agent which fails to withhold or collect the amount of
tax which should have been withheld or collected shall pay the amount of
tax which should have been withheld or collected but has not been withheld
or collected, except in the case where the withholding agent has promptly
reported to the tax authorities the situation regarding the refusal on the
part of a taxpayer to have the amount of tax withheld or collected.
Article 48
Where invoices are printed illegally in violation of the provisions
stipulated in Article 14 of this Law, the tax authorities shall destroy
the invoices which have been illegally printed, confiscate the illicit
gains, and impose a fine.
Article 49
The administrative punishment as prescribed in this Law shall be
decided by a tax bureau (or a subbureau thereof) above the county level.
Where a fine of not more than Renminbi 1000 Yuan is imposed on an
individual household engaged in industry and commerce or an entity or
individual which conducts business operations without a business licence,
the decision shall be made by the tax station concerned.
Upon receipt of a fine, the tax authorities shall issue a receipt.
Article 50
Where violence or menace is used to obstruct tax officials from
performing their duties in accordance with the law, criminal liabilities
shall be pursued in accordance with the provisions set forth in Article
157 of the Criminal Law. Where tax officials are refused or obstructed
from performing their duties in accordance with the law but no violence or
menace has been used, a punishment shall be imposed by the public security
authorities pursuant to the provisions stipulated in the Law Concerning
the Administration of Public Security and Punishments.
Article 51
The People's Courts and the tax authorities shall turn over the gains
from fines and confiscations they have received to the state treasury.
Article 52
Where tax officials collude with taxpayers or withholding agents, or
instigate or assist the same to commit the offenses specified in Article
40, 41, 42 and 44 of this Law, a punishment shall be imposed in accordance
with the provisions regarding joint offenses stipulated in the Criminal
Law. Where no offence is committed, administrative punishment shall be
imposed.
Article 53
Where tax officials take advantage of their positions and powers to
accept or extort the property of taxpayers or withholding agents, and such
acts constitute an offence, criminal liabilities of the tax officials
shall be investigated based on an offence of bribery. Where such acts do
not constitute an offence, administrative sanctions shall be imposed on
the tax officials.
Article 54
Where tax officials neglect their duties and fail to collect or
undercollect the correct amount of tax, causing enormous losses in the tax
revenue of the State, criminal liabilities of the tax officials shall be
investigated in accordance with the provisions set forth in Article 187 of
the Criminal Law. Where such acts do not constitute an offence,
administrative sanctions shall be imposed on the tax officials.
Tax officials who abuse their powers and deliberately create
difficulties for taxpayers and withholding agents shall be subject to
administrative sanctions.
Article 55
Where decisions regarding the collection of tax or the cessation
thereof, the reduction, exemption or refund of tax, or the payment of tax
underpaid have been made without authorization in violation of the law or
the administrative regulations, the decisions so made shall be revoked in
accordance with this Law. In addition, the amount of tax underpaid shall
be collected and the amount of tax overcollected shall be refunded. The
administrative liabilities of the officials directly responsible shall
also be investigated by the authorities at a higher level.
Article 56
In the case of tax disputes with the tax authorities, a taxpayer,
withholding agent or tax payment guarantor must first pay or remit the
amount of tax and fines on tax in arrears in accordance with the law or
the administrative regulations, and there after may, within 60 days from
the date of receipt of a payment receipt from the tax authorities, apply
to the tax authorities at a higher level for reconsideration. The tax
authorities at a higher level shall, within 60 days from the date of
receipt of the application for reconsideration, make a decision after
reconsideration. In the case of objection to the decision made after
reconsideration, legal proceedings may be instituted with the People's
Court within 15 days from the date of receipt of the decision made after
reconsideration.
Where a party concerned objects to a sanction decision made by the
tax authorities or to the mandatory measures or measures for retaining tax
revenue implemented by the same, it may, within 15 days from the date of
receipt of the sanction notice or the date the tax authorities implement
the mandatory measures or measures for retaining tax revenue, apply for a
reconsideration to the authorities one level higher than the authorities
which have made the sanction decision or implemented the mandatory
measures or measures for retaining tax revenue. If the party concerned
objects to the decision made upon reconsideration, it may, within 15 days
from the date of receipt of the reconsideration decision, institute legal
proceedings with the People's Court. Alternatively, the party concerned
may, within 15 days from the date of receipt of the sanction notice or the
date the tax authorities implement the mandatory measures or measures for
retaining tax revenue, institute legal proceedings directly with the
People's Court. In the course of making a reconsideration and instituting
legal proceedings, the mandatory measures or measures for retaining tax
revenue shall not cease to be implemented.
If the party concerned neither applies for a reconsideration of the
sanction decision made by the tax authorities and institutes legal
proceedings with the People's Court within the prescribed time limit nor
complies with the sanction decision, the tax authorities which have made
the sanction decision may apply to the People's Court for mandatory
enforcement of the decision.
CHAPTER VI-SUPPLEMENTARY PROVISIONS
Article 57
A taxpayer or withholding agent may appoint a tax agent to handle its
tax matters on its behalf.
Article 58
The administration of collection of agricultural tax, animal
husbandry tax, cultivated land usage tax and deed tax shall be implemented
with reference to the relevant provisions of this Law. The administration
of collection of customs duty, shipping tax and taxes collected by the
Customs on behalf of the tax authorities shall be implemented in
accordance with the relevant provisions stipulated in the law or the
administrative regulations.
Article 59
In the case of a discrepancy between the provisions of the relevant
tax treaties or agreements concluded between the People's Republic of
China and foreign countries and the provisions of this Law, the relevant
matters shall be handled in accordance with the treaties or agreements.
Article 60
In the case of a discrepancy between the provisions of the tax laws
promulgated prior to the implementation of this Law and the provisions of
this Law, the provisions of this Law shall apply.
Article 61
The detailed rules and regulations for the implementation of this Law
shall be formulated by the State Council in accordance with this Law.
Article 62
This Law shall come into force as of January 1, 1993. The "Interim
Provisions of the People's Republic of China Concerning the Administration
of Tax Collection" promulgated by the State Council on April 21, 1986
shall be superseded at the same time.
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