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| Law of the People's Republic of China on the Administration of Tax Collection |
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(Adopted at the 27th Meeting of the Standing Committee of the Seventh National People's Congress on September 4, 1992; amended in accordance with the Decision on Amending the Law of the People's Republic of China on the Administration of Tax Collection made by the Standing Committee of the Eighth National People's Congress at its 12th Meeting on February 28, 1995; revised at the 21st Meeting of the Standing Committee of the Ninth National People's Congress on April 28, 2001 and promulgated by Order No.49 of the President of the People's Republic of China on April 28, 2001) Contents Chapter I General Provisions Chapter II Tax Administration Section 1 Tax Registration Section 2 Administration of Accounting Books and Vouchers Section 3 Tax Declaration Chapter III Tax Collection Chapter IV Tax Inspection Chapter V Legal Liabilities Chapter VI Supplementary Provisions Chapter I General Provisions Article 1 This Law is enacted for the purpose of standardizing tax collection and payment, ensuring the tax revenues of the State, protecting the legitimate rights and interests of taxpayers and promoting economic and social development. Article 2 The administration of tax collection in respect of all taxes to be collected by the tax authorities in accordance with law shall be governed by this Law. Article 3 The imposition of tax, the cessation thereof, tax reduction, tax exemption, refund of tax and payment of delinquent tax shall be governed by the provisions of relevant laws; where the State Council is authorized by law to formulate relevant regulations, the provisions of relevant administrative regulations formulated by the State Council shall apply. No units including government departments or individuals may, in violation of laws or administrative regulations, make decisions regarding the imposition of tax, the cessation thereof, tax reduction, tax exemption, refund of tax or payment of delinquent tax, or any other decision which is in contravention with laws or administrative regulations governing tax collection. Article 4 Units and individuals that are obligated to pay tax as prescribed by laws or administrative regulations are taxpayers. Units and individuals that are obligated to withhold and remit tax or collect and remit tax as prescribed by laws or administrative regulations are withholding agents. Taxpayers and withholding agents shall pay tax or withhold and remit or collect and remit tax in accordance with the provisions of relevant laws or administrative regulations. Article 5 The competent department for taxation under the State Council shall be in charge of the administration of tax collection throughout the country. The national tax bureaus and the local tax bureaus in various places shall administer tax collection respectively within the limits set by the State Council. The local people's governments at various levels shall strengthen their leadership over or coordination of the administration of tax collection within their respective administrative regions, and support the tax authorities in performing out their duties in accordance with law, calculating the amounts of taxes to be paid according to the statutory tax rates and collecting taxes in accordance with law. The departments and units concerned shall support and assist the tax authorities in performing their duties in accordance with law. No units or individuals may obstruct the tax authorities from performing their duties in accordance with law. Article 6 The State, in a planned way, equips the tax authorities at various levels with modern information technology, enhances the modernization of the information system for administration of tax collection, and establishes and improves a information-sharing system among tax authorities and other administrative departments of the governments. Taxpayers, withholding agents and other units concerned shall, in accordance with relevant State regulations, provide the tax authorities with truthful information relating to payment of or withholding and remittance or collection and remittance of tax. Article 7 The tax authorities shall extensively disseminate the laws and administrative regulations on tax collection, popularize knowledge about payment of tax and provide, free of charge, the taxpayers with consultancy relating to payment of tax. Article 8 Taxpayers and withholding agents shall have the right to approach the tax authorities for information about the provisions of the State laws and administrative regulations on tax collection and information relating to the procedures of payment of tax. Taxpayers and withholding agents shall have the right to request the tax authorities to keep their information confidential. The tax authorities shall do so in accordance with law. Taxpayers shall, in accordance with law, have the right to apply for tax reduction, tax exemption and refund of tax. With regard to the decisions made by tax authorities, taxpayers and withholding agents shall have the right to argue their cases and defend themselves; they shall, in accordance with law, have the right to apply for administrative reconsideration, take administrative proceedings, request State compensation, etc. Taxpayers and withholding agents shall have the right to accuse tax authorities and officials of their violation of laws and rules of discipline and report such violations. Article 9 Tax authorities should enhance the level of their contingents, in order to improve the political and vocational quality of the tax officials. Tax authorities and officials shall implement laws impartially, devote themselves to their duties, be honest and upright, treat people politely, serve them with civility, respect and protect the rights of taxpayers and withholding agents and, in accordance with law, accept supervision. No tax officials may extort or take bribes, engage in malpractices for personal gain, neglect their duties, or fail to collect, or undercollect the amount of tax payable; nor may they abuse their power to overcollect tax or deliberately create difficulties for taxpayers or withholding agents. Article 10 Tax authorities at various levels shall establish and improve a system for internal restriction and supervision. The tax authorities at higher levels shall, in accordance with law, exercise supervision over the law-enforcement activities conducted by the authorities at lower levels. Tax authorities at various levels shall conduct inspection to see that their staff members are implementing laws and administrative regulations and observe the norms for incorruptibility and self-discipline. Article 11 The functions and responsibilities of the officials of the tax authorities in charge of tax collection, management, internal checking or administrative reconsideration shall be explicitly defined and shall be separate from each other and mutually restrained. Article 12 Any tax official who, in collecting taxes or investigating and handling cases of violation of laws on tax collection, is an interested party in relation to the taxpayers or withholding agents or the said cases, shall withdraw. Article 13 Every unit or individual shall have the right to report any violations of the laws and administrative regulations on tax collection. The authorities receiving such report and the authorities responsible for investigating and handling the case shall maintain confidentiality in respect of the accuser. The tax authorities concerned shall grant the accuser rewards in accordance with relevant regulations. Article 14 The tax authorities mentioned in this Law refer to the tax bureaus at various levels and their sub-bureaus and tax stations as well as the tax institutions which are established in accordance with the regulations of the State Council and are publicly announced. Chapter II Tax Administration Section 1 Tax Registration Article 15 Enterprises, the branches and the sites engaged in production or business operations established by enterprises in other places, industrial and commercial households and institutions engaged in production or business operations (hereinafter all referred to as taxpayers engaged in production or business operations) shall, within 30 days from the date the business license is obtained, apply to the tax authorities for tax registration by presenting the relevant documents. The tax authorities shall, within 30 days from the date the application is received, issue the tax registration certificate upon examination and verification of the documents. The administrative departments for industry and commerce shall keep the tax authorities regularly informed of their handling of registration and issuing of business licenses upon examination. The items for tax registration by taxpayers and withholding agents other than those specified in the first paragraph of this Article and the measures in this regard shall be formulated by the State Council. Article 16 When a taxpayer engaged in production or business operations intends to make any change in the items of tax registration, he shall, within 30 days from the date he completes the formalities for such change in the business registration with the administrative departments for industry and commerce or before he submits to the said department an application for cancellation of business registration, apply to the tax authorities for the change in or cancellation of tax registration by presenting the relevant documents. Article 17 Any taxpayer engaged in production or business operations shall, in accordance with relevant State regulations and by presenting the tax registration certificate, open a basic deposit account and other deposit accounts in banks or other financial institutions and shall report all the account numbers to the tax authorities. Banks and other financial institutions shall record in the accounts of the taxpayer engaged in production or business operations the number of his tax registration certificate. Where the tax authorities, in accordance with law, inquire about the accounts of a taxpayer engaged in production or business operations, the banks or other financial institutions shall provide assistance. Article 18 Use of tax registration certificates by taxpayers shall be governed by the relevant regulations formulated by the competent department for taxation under the State Council. No tax registration certificate may be lent, altered, damaged, traded or forged. Section 2 Administration of Accounting Books and Vouchers Article 19 Taxpayers and withholding agents shall, pursuant to the relevant laws, administrative regulations and regulations of the competent departments for finance and taxation under the State Council, establish accounting books, keep accounts on the basis of legitimate and valid vouchers and conduct accounting. Article 20 The financial and accounting systems or the financial and accounting procedures and the accounting softwares of taxpayers engaged in production or business operations shall be submitted to the tax authorities for the record. Where the financial and accounting systems or the financial and accounting procedures of taxpayers or withholding agents contravene the relevant regulations on tax collection formulated by the State Council or the departments for finance and taxation under the State Council, the tax payable, the tax withheld and remitted or collected and remitted shall be calculated in accordance with the said regulations. Article 21 The tax authorities are the competent departments in charge of invoices and are responsible for the control and supervision over printing, purchasing, writing out, obtaining, keeping and handing in for cancellation of invoices. When purchasing or selling commodities, providing or receiving business services or engaging in other business activities, all units and individuals shall write out, use or be given invoices. Measures for control of invoices shall be formulated by the State Council. Article 22 The special invoices for value-added tax shall be printed by enterprises designated by the competent department for taxation under the State Council; other invoices shall, pursuant to the regulations of the said department, be printed by the enterprises designated respectively by the national taxation bureaus or local taxation bureaus of provinces, autonomous regions or municipalities directly under the Central Government. No enterprises that are not designated by the taxation bureaus as provided for in the preceding paragraph may print invoices. Article 23 The State, based on the needs of the administration of tax collection, positively promotes the wide use of tax-monitoring devices. Taxpayers shall, in accordance with regulations, install and use tax-monitoring devices, and no one may damage or destroy or, without authorization, alter such devices. Article 24 Taxpayers engaged in production or business operations and withholding agents shall preserve their accounting books, vouchers for the accounts, tax payment receipts and other relevant information for a period as specified by the competent departments for finance and taxation under the State Council. No accounting books, vouchers for the accounts, tax payment receipts or other relevant information may be forged, altered or, without authorization, damaged or destroyed. Section 3 Tax Declaration Article 25 Taxpayers shall, within the time limit for and according to the items of tax declaration as prescribed by laws or administrative regulations, or as determined by the tax authorities in accordance with laws or administrative regulations, truthfully complete the formalities for tax declaration and submit tax returns, financial and accounting statements as well as other relevant information on tax payments as required of the taxpayers by the tax authorities in light of actual needs. Withholding agents shall, within the time limit for and according to the items of tax declaration as prescribed by laws or administrative regulations, or as determined by the tax authorities in accordance with laws or administrative regulations, submit truthful statements on taxes withheld and remitted or collected and remitted as well as other relevant information as required of the withholding agents by the tax authorities in light of actual needs. Article 26 Taxpayers and withholding agents may directly go to the tax authorities to complete the formalities for tax declaration or to submit statements on tax withheld and remitted or collected and remitted, or, in accordance with regulations, handle the declaration or submission matters mentioned above by mail, electronic data transmission or other means. Article 27 Where taxpayers or withholding agents are unable to complete the formalities for tax declaration or to submit statements on the tax withheld and remitted or collected and remitted within the prescribed time limit, the time limit may be extended upon examination and approval by the tax authorities. Anyone who is permitted to handle the declaration or submission matters mentioned above within the time limit extended upon examination shall, within the prescribed time limit for tax payment, prepay the tax on the basis of the amount of the tax he actually paid last or the amount determined by the tax authorities upon examination, and settle the payment within the extended time limit approved upon examination. Chapter III Tax Collection Article 28 The tax authorities shall collect tax in accordance with the provisions of laws or administrative regulations. They may not, in violation of such provisions, impose, cease to collect, overcollect, undercollect, collect in advance, postpone the collection of, or apportion tax. The amount of agricultural tax payable shall be determined upon examination in accordance with the provisions of laws and administrative regulations. Article 29 With the exception of tax authorities, tax officials and the units and individuals authorized by the tax authorities in accordance with laws and administrative regulations, no unit or individual may engage in tax collection. Article 30 Withholding agents shall perform their obligations of withholding or collecting tax in accordance with the provisions of laws or administrative regulations. With respect to units or individuals that are not obligated to withhold or collect tax as prescribed by laws or administrative regulations, no tax authorities may request them to perform such obligations. When withholding agents perform the obligations of withholding or collecting tax in accordance with law, no taxpayers may refuse to pay tax to them. Where a taxpayer refuses to do so, the withholding agent shall promptly report the matter to the tax authorities for disposition. The tax authorities shall, in accordance with relevant regulations, pay to withholding agents service fees for withholding or collecting tax. Article 31 A taxpayer or withholding agent shall pay or remit tax in compliance with the time limit as prescribed by laws or administrative regulations, or as determined by tax authorities in accordance with laws or administrative regulations. Where a taxpayer is unable to pay tax within the prescribed time limit on account of special difficulties, he may, upon approval by a national tax bureau or a local tax bureau of a province, autonomous region or municipality directly under the Central Government, defer the payment of tax for a maximum period of three months. Article 32 Where a taxpayer fails to pay tax or a withholding agent fails to remit tax within the specified time limit, the tax authorities shall, in addition to ordering the taxpayer or withholding agent to pay or remit the tax within a fixed period of time, impose a surcharge on a daily basis at the rate of 0.05% of the amount of tax in arrears, from the date the tax payment is defaulted. Article 33 A taxpayer may, in accordance with laws or administrative regulations, apply in writing for tax reduction or tax exemption. Applications for tax reduction or tax exemption shall be subject to examination and approval by the examination and approval authorities for tax reduction or tax exemption specified by laws or administrative regulations. All decisions on tax reduction or tax exemption made in violation of laws or administrative regulations by the local people's governments at various levels, the competent departments under the said people's governments, or by units or individuals shall be null and void. No tax authorities may implement such decisions, and they shall instead report the matter to the tax authorities at a higher level. Article 34 When collecting tax, tax authorities shall issue tax payment receipts to taxpayers. When withholding or collecting tax, the withholding agents shall, upon request by taxpayers, issue to them receipts for withholding or collecting tax. Article 35 If a taxpayer is under one of the following circumstances, tax authorities shall have the power to assess the amount of tax payable by him: (1) where the establishment of accounting books is dispensed with in accordance with the provisions of laws and administrative regulations; (2) where accounting books are required to be established by the provisions of laws and administrative regulations, but they are not established; (3) where the taxpayer damages or destroys accounting books without authorization or refuses to provide information on tax payment; (4) where accounting books are established, but the accounts are not in order or information on costs, receipt vouchers and expense vouchers are incomplete, making it difficult to check the books; (5) where, when the obligation to pay tax arises, the taxpayer fails to complete the formalities for tax declaration within the specified time limit and, after being ordered by tax authorities to make tax declaration within a fixed period of time, still fails to do so upon expiration of the time limit; and (6) where the basis for assessing tax declared by the taxpayer is obviously on the low side and without justifying grounds. The specific procedure and measures for the tax authorities to determine the amounts of the tax payable shall be formulated by the competent department for taxation under the State Council. Article 36 The payment or receipt of money or charges in business transactions between an enterprise, or an establishment or site engaged in production or business operations which is set up by a foreign enterprise in China, and its associated enterprises shall be made in the same manner as the payment or receipt of money or charges in business transactions between independent enterprises. Where the payment or receipt of money or charges is not made in the said manner and thus results in a reduction of the taxable revenue or income, the tax authorities shall have the power to make reasonable adjustments. Article 37 Where a taxpayer engaged in production or business operations or a taxpayer temporarily engaged in business operations fails to complete the formalities for tax registration in accordance with regulations, the tax authorities shall assess the amount of tax payable by him and order him to make the payment; if he fails to do so, the tax authorities may distrain the commodities or goods of a value equivalent to the amount of tax payable; if he pays the amount of tax payable after the distraint, the tax authorities shall immediately remove the distraint and return the commodities or goods distrained; if he still fails to pay the amount of tax payable after the distraint, the commodities or goods distrained shall, upon approval of the commissioner of the tax bureau (or sub-bureau) at or above the county level, be auctioned or sold off in accordance with law and the proceeds therefrom shall be used to offset the amount of tax payable. Article 38 Where the tax authorities have grounds to believe that a taxpayer engaged in production or business operations commits an act of tax evasion, they may, prior to the prescribed date of tax payment, order the taxpayer to pay the tax payable within a fixed period of time. If, within the fixed period of time, the tax authorities discover evident signs that the taxpayer is transferring or concealing the taxable commodities, goods or other property, or taxable income, they may order the taxpayer to provide a guaranty for tax payment. If the taxpayer is unable to do so, the tax authorities may, upon approval of the commissioner of the tax bureau (or sub-bureau) at or above the county level, adopt the following tax preservation measures: (1) to notify in writing the bank or any other financial institution with which the taxpayer has opened an account to freeze the taxpayer's deposits to the tune equivalent to the amount of tax payable; and (2) to distrain or seal up the taxpayer's commodities, goods or other property to the value equivalent to the amount of tax payable. Where the taxpayer makes the tax payment within the fixed period of time prescribed in the preceding paragraph, the tax authorities shall immediately lift the tax preservation measures. Where the taxpayer fails to do so on the expiration of the fixed period of time, the tax authorities may, upon approval of the commissioner of the tax bureau (or sub-bureau) at or above the county level, notify in writing the bank or any other financial institution with which the taxpayer has opened an account to withhold and remit the amount of tax payable from the taxpayer's frozen deposits, or, in accordance with law, auction or sell off the commodities, goods or other property distrained or sealed up and use the proceeds therefrom to offset the amount of tax payable. Any housing or articles for use which are necessary for the daily lives of an individual and the family members he supports shall not be subjected to the tax preservation measures. Article 39 Where a taxpayer makes the tax payment within the fixed period of time while the tax authorities fail to immediately lift the tax preservation measures, thus causing losses to the legitimate interests of the taxpayer, the tax authorities shall be liable for compensation. Article 40 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 him to pay the tax within a fixed period of time. Where he fails to pay the tax on the expiration of the time limit, the tax authorities may, upon approval of the commissioner of the tax bureau (or sub-bureau) at or above the county level, adopt the following compulsory enforcement measures: (1) to notify in writing the bank or any other financial institution with which the taxpayer, withholding agent or tax payment guarantor has opened an account to withhold and remit the amount of tax from his deposits; (2) to distrain, seal up or, in accordance with law, auction or sell off the commodities, goods or other property of the taxpayer, withholding agent or tax payment guarantor, to the value equivalent to the amount of tax payable, and to use the proceeds therefrom to offset the amount of tax payable. When executing the compulsory enforcement measures, the tax authorities shall do the same with regard to the surcharge which is unpaid by the taxpayer, withholding agent or tax payment guarantor mentioned in the preceding paragraph. Any housing or articles for use which are necessary for the daily lives of an individual and the family members he supports shall not be subjected to the compulsory enforcement measures. Article 41 No units or individuals other than the statutory tax authorities may exercise the power to adopt tax preservation measures or compulsory enforcement measures provided for in Articles 37, 38 and 40 of this Law. Article 42 The tax authorities shall adopt tax preservation measures or compulsory enforcement measures in compliance with the limits of power and procedures prescribed by law, and they may not seal up or distrain any housing and articles for use which are necessary for the daily lives of the taxpayer himself and the family members he supports. Article 43 Where the tax authorities abuse their power and, in violation of law, adopt tax preservation measures or compulsory enforcement measures, or inappropriately adopt such measures, thus causing losses to the legitimate rights and interests of taxpayers, withholding agents or tax payment guarantors, the tax authorities shall be liable for compensation in accordance with law. Article 44 Where the taxpayer, who defaults on tax payment, or his legal representative needs to leave the Article 45 Tax collection by the tax authorities shall have precedence over unwarranted claims, except where otherwise provided for by law; where tax is defaulted before the taxpayer mortgages or pledges his property or before the taxpayer's property is distrained, tax collection shall have the precedence over the exercise of the right of mortgage, pledge or lien. Where a taxpayer defaults on tax payment and is at the same time fined and his unlawful gains are to be confiscated upon decision by an administrative department, tax collection shall have precedence over the fine and confiscation of unlawful gains. The tax authorities shall regularly announce the taxes defaulted on by taxpayers. Article 46 Where a taxpayer defaults on tax payment and puts his property in mortgage or pledge, he shall explain to the mortgagee or pledgee about his default on tax payment. The mortgagee or pledgee may request the tax authorities to provide information about the default. Article 47 The tax authorities shall issue a receipt when distraining commodities, goods or other property, and issue a detailed list when sealing up commodities, goods or other property. Article 48 Where taxpayers merge or separate their businesses, they shall report the matter to the tax authorities and pay off the tax payable in accordance with law. If a taxpayer fails to pay off the tax payable at the time of merger, the new taxpayer after the merger shall continue to fulfill the duty to pay tax; if a taxpayer fails to pay off the tax payable at the time of separation, the new taxpayer after the separation shall bear joint and several liability for the unfulfilled duty. Article 49 Any taxpayer who defaults on payment of a considerable amount of tax shall, before disposing of his real estate or large amount of fixed assets, report the matter to the tax authorities. Article 50 Where a taxpayer who defaults on tax payment is indolent in exercising his natural creditor's rights, or disclaims such rights, or transfers gratis his property, or transfers his property at a low price evidently unreasonable, which the transferee is aware of, thus causing losses to tax collection of the State, the tax authorities may, in accordance with the provisions in Articles 73 and 74 of the Contract Law, exercise the rights of subrogation and rescission. Where the tax authorities exercise the rights of subrogation and rescission in accordance with the provisions in the preceding paragraph, the taxpayer who defaults on tax payment shall not be exempted from fulfilling the duty to pay the tax or from bearing the legal liability. Article 51 Where the tax authorities discover that a taxpayer makes a tax payment in excess of the amount of tax payable, they shall immediately refund the excess payment; where a taxpayer discovers the same, he may, within three years from the date the payment is made, claim from the tax authorities a refund of the excess payment, plus the interests calculated according to the bank interest rates at the time, and the tax authorities shall immediately pay back the money upon examination and verification of the case; where such refund involves the State Treasury, it shall be dealt with in accordance with the provisions on the administration of the State Treasury in relevant laws and administrative regulations. Article 52 Where a taxpayer or withholding agent fails to pay or underpays tax, for which the responsibility rests with the tax authorities, the latter may, within three years, require the taxpayer or withholding agent to pay the tax in arrears without, however, the imposition of any surcharge thereon. Where a taxpayer or withholding agent fails to pay or underpays tax owing to his own miscalculation or other faults, the tax authorities may, within three years, pursue the collection of the tax in arrears and the surcharge thereon; under special circumstances, the time limit for pursuing the collection of the tax in arrears may be extended to five years. Where a taxpayer evades, refuses to pay or practises fraud in tax payment and the tax authorities pursue the collection of the unpaid or underpaid tax, the surcharge thereon, or the tax payment defrauded on, the latter shall not be restricted by the time limit prescribed in the preceding paragraph. Article 53 The national and local tax bureaus shall, in conformity with their respective areas of administration for tax collection and the levels of budgeted tax for the State Treasury prescribed by State regulations, turn over the collected tax to the State Treasury. Where, in accordance with law, the auditing or finance authorities find out any violation of law on tax collection, the tax authorities shall, based on the decisions or written suggestions of the related authorities and in accordance with law, turn over the tax and surcharge thereon collected to the State Treasury in conformity with the levels of budgeted tax for the State Treasury, and inform in return the related authorities of the result without delay. Chapter IV Tax Inspection Article 54 The tax authorities shall have the power to conduct the following tax inspections: (1) to inspect a taxpayer's accounting books, vouchers for the accounts, statements and relevant information; to inspect a withholding agent's accounting books, vouchers for the accounts and 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 sites where production or business operations are conducted and places where goods are stored; to inspect a withholding agent's operational conditions relating to the withholding and remittance of tax or the collection and remittance of tax; (3) to order a taxpayer or withholding agent to furnish documents, certifying papers 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 issues and particulars relevant to the payment of tax or the amount of tax withheld and remitted or collected and remitted; (5) to inspect, at railway stations, docks, airports, postal enterprises and their branches, supporting documents, vouchers and information pertaining to the taxable commodities, goods or other p roperty which a taxpayer has delivered for carriage or sent by post; and (6) upon approval of the commissioner of the tax bureau (or sub-bureau) at or above the county level, to inquire about the deposit accounts that a taxpayer engaged in production or business operations or a withholding agent has opened with a bank or any other financial institution. Upon approval of the commissioner of the tax bureau (sub-bureau) at or above the level of the city divided into districts or the autonomous prefecture, inquire about the savings a suspect involved in a case. No information obtained through inquiry by the tax authorities may be used for purposes other than tax collection. Article 55 When the tax authorities, in accordance with law, conduct tax inspection of a taxpayer engaged in production or business operations in respect of the tax payment made during earlier tax periods and discover the taxpayer's evasion of the obligation to pay tax and evident signs of transfer or concealment of taxable commodities, goods or other property or incomes, they may adopt tax preservation measures or compulsory enforcement measures in conformity with the power granted according to this Law. Article 56 A taxpayer or withholding agent shall subject himself to tax inspection conducted by the tax authorities in accordance with law, report the particulars truthfully and provide relevant information, and may not refuse to accept such inspection or conceal any facts. Article 57 When the tax authorities conduct tax inspection in accordance with law, they shall have the power to inquire the related units and individuals about the particulars of taxpayers, withholding agents and other parties in respect of the payment of tax and the amount of tax withheld and remitted or collected and remitted, and the said units and individuals shall truthfully provide the relevant information and certifying papers to the tax authorities. Article 58 When investigating a case concerning violation of laws or regulations on tax collection, the tax authorities may take notes and make tape-recordings, video-recordings, photographings and duplications of the particulars and information pertaining to the case. Chapter V Legal Liabilities Article 60 Where a taxpayer commits one of the following acts, he shall be ordered by the tax authorities to rectify within a time limit and may be fined not more than RMB 2,000 yuan; if the circumstances are serious, he may be fined not less than 2,000 yuan but not more than 10,000 yuan: (1) failing to apply for tax registration or for change or cancellation of tax registration within the prescribed time limit; (2) failing to establish and preserve accounting books, or keep the vouchers for the accounts and the relevant information in accordance with regulations; (3) failing to submit the financial and accounting systems or the financial and accounting procedures and the accounting softwares to the tax authorities for the record in accordance with regulations; (4) failing to report all the numbers of bank accounts to the tax authorities in accordance with regulations; and (5) failing to install or use tax-monitoring devices in accordance with regulations, or damaging or destroying or, without authorization, altering such devices. Where a taxpayer fails to go through the formalities for tax registration, the tax authorities shall order him to rectify within a time limit; if he still fails to rectify on the expiration of the time limit, the administrative department for industry and commerce shall, upon proposal and request of the tax authorities, revoke his business license. Where a taxpayer fails to use the tax registration certificate in accordance with regulations, or lends, alters, damages or destroys, trades or forges tax registration certificate, he shall be fined not less than 2,000 yuan but not more than 10,000 yuan; if the circumstances are serious, he shall be fined not less than 10,000 yuan but not more than 50,000 yuan. Article 61 Where a withholding agent fails to establish and preserve accounting books for the tax withheld and remitted or collected and remitted, or preserve the vouchers for the accounts and the relevant information regarding the tax withheld and remitted or collected and remitted, in accordance with relevant regulations, he shall be ordered by the tax authorities to rectify within a time limit and may be fined not more than 2,000 yuan; if the circumstances are serious, he shall be fined not less than 2,000 yuan but not more than 5,000 yuan. Article 62 Where, within the prescribed time limit, a taxpayer fails to go through the formalities for tax declaration and submit information on tax payment or a withholding agent fails to submit to the tax authorities statements on taxes withheld and remitted or collected and remitted and other relevant information, he shall be ordered by the tax authorities to rectify within a time limit and may be fined not more than 2,000 yuan; if the circumstances are serious, he may be fined not less than 2,000 yuan but not more than 10,000 yuan. Article 63 Tax evasion means that a taxpayer forges, alters, conceals or, without authorization, destroys accounting books or vouchers for the accounts, or overstates expenses or omits or understates incomes in the accounting books, or, after being notified by the tax authorities to make tax declaration, refuses to do so or makes false tax declaration, or fails to pay or underpays the amount of tax payable. Where a taxpayer evades tax, the tax authorities shall pursue the payment of the amount of tax he fails to pay or underpays and the surcharge thereon, and he shall also be fined not less than 50 percent but not more than five times the amount of tax he fails to pay or underpays; if a crime is constituted, he shall be investigated for criminal responsibility in accordance with law. Where a withholding agent fails to pay, or underpays the tax which he withholds or collects by the means mentioned in the preceding paragraph, the tax authorities shall pursue the payment of the amount of tax he fails to pay or underpays and the surcharge thereon, and he shall also be fined not less than 50 percent but not more than five times the amount of tax he fails to pay or underpays; if a crime is constituted, he shall be investigated for criminal responsibility in accordance with law. Article 64 Where a taxpayer or withholding agent fabricates the basis on which tax is assessed, he shall be ordered by the tax authorities to rectify within a time limit and shall also be fined not more than 50,000 yuan. Where a taxpayer fails to make tax declaration, or fails to pay or underpays the tax payable, the tax authorities shall pursue the payment of the amount of tax he fails to pay or underpays and the surcharge thereon, and he shall also be fined not less than 50 percent but not more than five times the amount of tax he fails to pay or underpays. Article 65 Where a taxpayer who fails to pay the tax due adopts the means of transferring or concealing his property, thus preventing the tax authorities from pursuing the payment of the tax in arrears, the tax authorities shall pursue the payment of the tax and the surcharge thereon and shall also impose on him a fine of not less than 50 percent but not more than five times the amount of tax in arrears; if a crime is constituted, he shall be investigated for criminal responsibility in accordance with law. Article 66 Where anyone, by making false export declaration or by other means, defrauds tax refund for exports from the State, the tax authorities shall pursue the return of the refund defrauded, and the person shall also be fined not less than the amount of the refund defrauded but not more than five times that amount; if a crime is constituted, he shall be investigated for criminal responsibility in accordance with law. Where anyone defrauds tax refund for exports from the State, the tax authorities may, within a specified time limit, suspend tax refund for his exports. Article 67 Refusal to pay tax means refusing to pay tax with resort to violence or threats. In such a case, the tax authorities shall, in addition to pursuing the payment of the amount of tax a person refuses to pay and the surcharge thereon, conduct investigation for criminal responsibility in accordance with law. If the circumstances are not serious and no crime is constituted, the tax authorities shall pursue the payment of the amount of tax he refuses to pay and the surcharge thereon and shall also impose on him a fine of not less than the amount of the tax he refuses to pay but not more than five times that amount. Article 68 Where a taxpayer or a withholding agent fails to pay or underpays the amount of tax that should be paid or remitted within the prescribed time limit and, after ordered by the tax authorities to pay or remit within a time limit, still fails to do so on the expiration of the time limit, the tax authorities may, in addition to pursuing, by adopting compulsory enforcement measures in accordance with the provisions in Article 40 of this Law, the payment of the amount of tax the taxpayer or withholding agent fails to pay or underpays or fails to remit, impose a fine of not less than 50 percent but not more than five times the amount of tax he fails to pay or underpays or fails to remit. Article 69 Where a withholding agent fails to withhold or collect the amount of tax which should be withheld or collected, the tax authorities shall pursue the payment of the said amount, and impose on the withholding agent a fine of not less than 50 percent but not more than three times the amount of tax that should have been withheld or collected. Article 70 Where a taxpayer or a withholding agent avoids, refuses to undergo or, by other means, hinders inspection by the tax authorities, he shall be ordered by the tax authorities to rectify and may be fined not more than 10,000 yuan; if the circumstances are serious, he shall be fined not less than 10,000 yuan but not more than 50,000 yuan. Article 71 Where anyone, in violation of the provisions in Article 22 of this Law, illegally prints invoices, the tax authorities shall destroy the invoices illegally printed, confiscate his unlawful gains and tools for criminal purposes and impose on him a fine of not less than 10,000 yuan but not more than 50,000 yuan; if a crime is constituted, he shall be investigated for criminal responsibility in accordance with law. Article 72 Where a taxpayer engaged in production or business operations or a withholding agent commits an act in violation of the provisions in this Law on tax collection and refuses to be dealt with by the tax authorities, the tax authorities may confiscate his invoices or discontinue selling invoices to him. Article 73 Where a bank or other financial institution with which a taxpayer or a withholding agent has opened deposit accounts refuses to accept the tax authorities' inspection of the deposit accounts of the said taxpayer or withholding agent in accordance with law, or refuses to execute the decision made by the tax authorities on freezing the deposits or withholding the tax, or, after receiving the written notice of the tax authorities, assists the taxpayer or withholding agent in transferring his deposits, thus causing the loss of tax, it shall be fined by the tax authorities not less than 100,000 yuan but not more than 500,000 yuan, and the persons who are directly in charge and the other persons who are directly responsible shall be fined not less than 1,000 yuan but not more than 10,000 yuan. Article 74 The imposition of administrative penalties prescribed in this Law, if the fines involved are not more than 2,000 yuan, may be decided on by the tax stations. Article 75 The tax and judicial authorities shall, in conformity with the levels of budgeted tax for the State Treasury, turn over all the revenues from tax-related fines and confiscations to the State Treasury. Article 76 Where the tax authorities that, in violation of regulations and without authorization, change the administrative areas for tax collection and the levels of budgeted tax for the State Treasury shall be ordered to rectify within a time limit, and the persons who are directly in charge and the other persons who are directly responsible shall, in accordance with law, be demoted or dismissed from office, as administrative sanctions. Article 77 Where a taxpayer or withholding agent is suspected of committing an offense against the provisions in Article 63, 65, 66, 67 or 71 of this Law, the tax authorities shall transfer the case to the judicial authorities to be investigated for criminal responsibility in accordance with law. Where a tax official, engaging in malpractices for personal gain, fails to transfer, in accordance with law, the case to the judicial authorities for investigation for criminal responsibility as he should have done, if the circumstances are serious, he shall be investigated for criminal responsibility in accordance with law. Article 78 Where anyone collects tax without authorization by the tax authorities in accordance with law, he shall be ordered to return the money and things of value collected and, in accordance with law, be given administrative sanctions or penalties; where losses are caused to other persons' legitimate rights or interests, he shall be liable for compensation in accordance with law; if a crime is constituted, he shall be investigated for criminal responsibility in accordance with law. Article 79 Where the tax authorities or tax officials seal up or distrain a taxpayer's housing and articles of use which are necessary for the daily lives of the taxpayer himself and the family members he supports, they shall be ordered to return the said housing and articles for use and, in accordance with law, be given administrative sanctions; if a crime is constituted, they shall be investigated for criminal responsibility in accordance with law. Article 80 Where tax officials, working in collusion with taxpayers or withholding agents, instigate or assist them to commit an offense against the provisions in Article 63, 65 or 66 of this Law, if a crime is constituted, the tax officials shall be investigated for criminal responsibility in accordance with law; if no crime is constituted, they shall be given administrative sanctions in accordance with law. Article 81 Where tax officials, by taking advantage of their positions, accept or extort money or things of value from taxpayers or withholding agents, or seek other illegitimate interests, if a crime is constituted, they shall be investigated for criminal responsibility in accordance with law; if no crime is constituted, they shall be given administrative sanctions in accordance with law. Article 82 Where tax officials, engaging in malpractices for personal gain or neglecting their duty, fail to collect or under-collect the tax that should be collected, thus causing heavy losses to State revenue, if a crime is constituted, they shall be investigated for criminal responsibility in accordance with law; if no crime is constituted, they shall be given administrative sanctions in accordance with law. Tax officials who, abusing their power, deliberately create difficulties for taxpayers or withholding agents shall be transferred from the post for tax collection and, in accordance with law, be given administrative sanctions. Where tax officials retaliate against taxpayers or withholding agents who complain of or report violations of the laws or rules of discipline on tax collection, or any other accuser, they shall be given administrative sanctions in accordance with law; if a crime is constituted, they shall be investigated for criminal responsibility in accordance with law. Where tax officials, in violation of the provisions of laws or administrative regulations, deliberately over- or under-assess the agricultural yield taxable, thus causing over- or under-collection of tax, infringing upon the peasants' legitimate rights and interests or undermining the interests of the State, if a crime is constituted, they shall be investigated for criminal responsibility in accordance with law; if no crime is constituted, they shall be given administrative sanctions in accordance with law. Article 83 Where, in violation of the provisions of laws or administrative regulations, tax are collected in advance, the collection is postponed, or taxes are apportioned, the authorities at a higher level or the administrative supervisory authorities shall order its rectification, and the persons who are directly in charge and the other persons who are directly responsible shall be given administrative sanctions in accordance with law. Article 84 Where decisions regarding the imposition or cessation of tax, tax reduction, tax exemption, refund of tax or payment of tax underpaid, or other decisions contravening the laws or administrative regulations on tax collection are made without authorization and in violation of the provisions of laws or administrative regulations, in addition to revocation of such decisions in accordance with the provisions of this Law, the amount of tax that should have been collected shall be collected, the amount of tax that should not have been collected shall be refunded, and the persons who are directly in charge and the other persons who are directly responsible shall be pursued for administrative liability by the authorities at a higher level; if a crime is constituted, investigation for criminal responsibility shall be conducted in accordance with law. Article 85 Where, in collecting tax or in investigating cases of violation of the laws on tax collection, tax officials fail to withdraw as required by the provisions of this Law, the persons who are directly in charge and the other persons who are directly responsible shall be given administrative sanctions in accordance with law. Article 86 If any violation of the laws or administrative regulations on tax collection which deserves administrative penalties is undetected for five years, no administrative penalties shall be imposed any longer. Article 87 Where tax officials fail to keep confidentiality for the taxpayers, withholding agents or accusers, the persons who are directly in charge and the other persons who are directly responsible shall, in accordance with law, be given administrative sanctions by the units they belong to or the units concerned. Article 88 Where a tax dispute arises between a taxpayer, withholding agent or tax payment guarantor and the tax authorities, the former shall pay or remit the amount of tax payable and the surcharge thereon, or provide the necessary guaranty in accordance with the decisions made by the tax authorities on tax collection, before he may apply for administrative reconsideration in accordance with law; if he is not satisfied with the decision made after reconsideration, he may bring a lawsuit in the People's Court in accordance with law. Where a party is not satisfied with the penalty decision made or the compulsory enforcement measures or tax preservation measures ado pted by the tax authorities, he may, in accordance with law, apply for administrative reconsideration or bring a lawsuit in the People's Court in accordance with law. Where, on the expiration of the time limit, the party fails to apply for administrative reconsideration of the penalty decision made by the tax authorities, nor does he bring a lawsuit in the People's Court or comply with the decision, the tax authorities that make the decision may adopt compulsory enforcement measures prescribed in Article 40 of this Law, or apply to the People's Court for compulsory enforcement of the decision. Chapter VI Supplementary Provisions Article 89 A taxpayer or withholding agent may entrust a tax agent with the handling of tax affairs on his behalf. Article 90 Specific measures for the administration of collection of cultivated land use tax, deed tax, agricultural tax and animal husbandry tax shall be formulated by the State Council separately. The administration of collection of the Customs duties and the taxes collected by the Customs on behalf of the tax authorities shall be exercised in accordance with the provisions of relevant laws or administrative regulations. Article 91 Where the provisions of treaties or agreements on tax concluded between the People's Republic of Article 92 Where the tax laws promulgated prior to the implementation of this Law contain provisions differing from those of this Law, the provisions of the latter shall apply. Article 93 The detailed rules for implementation of this Law shall be formulated by the State Council in accordance with this Law. Article 94 This Law shall go into effect as of May 1, 2001. ( Legislative Affairs Commission of the Standing Committee of the National People's Congress)
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