CX Daily: Chinese Livestreamers’ Tax Evasion Calls For Systematic Tax Reform

Tax evasion /

Cover Story: Chinese livestreamers’ tax evasion calls for systematic tax reform

China’s recent record fine on a top celebrity livestreamer signals that the authorities are tightening taxation on high-income individuals, but to close a loophole that enables tax evasion in the booming but underregulated sector, a formal tax system revamp is necessary, tax experts said.

Huang Wei, one of the highest-earning livestreamers, known online as “Weiya,” was ordered to pay 1.34 billion yuan ($210 million) in back taxes, late fees, and fines after tax authorities in the eastern city of Hangzhou found she avoided taxes totaling 643 million yuan in 2019 and 2020.

The case followed a combined 93.2 million yuan of fines imposed in November on two other influential livestreamers for income tax evasion. In all cases, the livestreamers evaded taxes mainly by setting up multiple sole-proprietorship companies and partnerships and reporting commission income and spot fees as more lightly taxed business income, the tax authorities said.

FINANCE & ECONOMY

The headquarters of the National Development and Reform Commission in Beijing in December 2020. Photo: VCG

Negative list /

China fleshes out regulation on domestic firms listed overseas

China further clarified the regulations for domestic companies seeking to list overseas when it published a new negative list for foreign investment Monday.

In the list, which specifies the domestic businesses that foreign investors are restricted from entering, authorities said Chinese firms in the businesses on the list can file for offshore listings as long as they win regulatory approval and meet certain requirements.

The negative list (link in Chinese), jointly issued by China’s National Development and Reform Commission and Ministry of Commerce, takes effect Saturday.

Caixin Explains: What China’s New Investment Rules Mean for Foreign Investors

Carbon /

China to let local governments find own ways to meet national carbon goals

China will start selecting local governments to conduct pilot programs to facilitate investment and financing for climate-related projects as it encourages them to find their own ways to fight climate change and bankroll the nation’s decarbonization drive.

Climate investment and financing aims to channel more funds into climate resilience, according to a work plan (link in Chinese) released last week by the Ministry of Ecology and Environment, the People’s Bank of China and seven other state departments. The document lays out the goals and tasks for carrying out climate investment and financing pilot projects.

Year in Review: China takes pragmatic approach to meeting carbon emission goals

Ant Group /

China Cinda buys 20% stake in Ant’s consumer finance unit

Ant Group’s consumer finance unit will receive 22 billion yuan ($3.5 billion) of fresh funding from a group of investors including one of China’s state-owned asset managers.

China Cinda Asset Management Co. will join a group of investors led by Ant Group in the new funding round of Chongqing Ant Consumer Finance Co. Ltd. Other investors include Sunny Optics, Boguan Technology, Yufu Capital and Jiangsu Yuyue Medical Equipment & Supply Co. Ltd., according to company filings.

China Cinda will hold a 20% stake in the unit with an investment of 6 billion yuan.

Quick hits /

Chinese province offers $31,000 baby loans to counter shrinking population

Chinese mainland, Hong Kong bourses to add ETFs to stock connect scheme

Editorial: How government frugality can serve the people

BUSINESS & TECH

A Delta Air Lines flight scheduled to land at Shanghai Pudong International Airport on Friday morning had to unexpectedly turn back over Russia six hours into its flight from Seattle, according to media reports.

Flights /

China advises U.S. air passengers to anticipate changes after Delta flight turned back

China warned passengers with plans to fly to China from the U.S. to anticipate flight changes after several flights were delayed or canceled, including one from Seattle to Shanghai that returned to the U.S. midway.

The Chinese Embassy in the U.S. said in a notice Saturday that it complained to the airline involved and advised passengers to confirm their flight status and complete the tests needed before boarding. The embassy and consulates would continue to urge U.S. airlines to guarantee passengers’ legitimate rights, the statement said.

A Delta Air Lines flight scheduled to land at Shanghai Pudong International Airport Friday morning had to unexpectedly turn back over Russia six hours into its flight from Seattle, according to media reports.

Renewable energy /

China’s renewable energy generation tops 1 trillion kWh

China’s cumulative annual renewable energy generation surpassed 1 trillion kilowatt-hours (kWh) for the first time, jumping by a third over the same time last year as the country races to meet climate goals by 2030.

Electricity generated from renewable sources totaled 1.04 trillion kWh during the first 11 months of this year, a 33% jump from 2020, according to data announced by the National Energy Administration (NEA) (link in Chinese) at a Friday briefing.

IPO /

Q&A forum Zhihu denies reports of Hong Kong IPO

Zhihu Inc., the Chinese question-and-answer forum, denied media reports that it was about to undertake a secondary listing in Hong Kong, saying the company had not heard the news.

Citing state-owned news outlet The Paper, Bloomberg reported Saturday that the Beijing-based company plans to submit documents for a share offering in Hong Kong in January.

Power /

China’s state assets regulator takes control of Southern Power Grid with stake hike

The State-owned Assets Supervision and Administration Commission (SASAC), the central government’s state assets regulator, raised its stake in China Southern Power Grid Co. Ltd. to 51% from 26.4% as part of an ownership restructuring plan aimed at improving corporate governance.

The ownership change was announced Saturday at a Southern Power Grid conference to discuss how it could achieve high-quality development by optimizing its ownership structure. The restructuring plan, approved by the State Council, can be seen as an important measure to promote the development of China’s power industry and ensure the country’s energy security, SASAC Chairman Hao Peng said.

Quick hits /

China Mobile boosts share sale to be world’s second-largest in 2021

Energy Insider /

China unveils state-owned rare earths giant

GALLERY

Cold front blankets North China in snow

Recommended newsletter for you /

China Green Bulletin Premium - Subscribe to join the Caixin green community and stay up to date with the most exclusive insights on ESG, energy and carbon. Sign up here.

Thanks for reading. If you haven’t already, click here to subscribe.