2012年1月12日,发课公司就北京地税局第二稽查局的税务处理决定向北京地税局提出复议申请,申请书认为,由于存在程序错误、适用依据不合法、事实不清、征收方式错误、欠缺法定内容等原因,要求依法撤销该税务处理决定。

今天(2012年1月18日)北京市地税局正式受理了该申请。

此为发课公司第二份行政复议申请,之前就税务处罚向北京地税提出的第一份复议申请已于1月4日被受理。
-------------------


行政复议申请书

申 请 人:北京发课文化发展有限公司
住 所 地:北京市朝阳区崔各庄乡草场地村258号(邮政编码:100015)
法定代表人:路 青

被 申请 人:北京市地方税务局第二稽查局

申请事项:

1、被申请人所依据的《北京市地方税务局关于明确企业所得税若干政策业务问题的通知》(京地税企【2002】526号)不合法,申请对该规定予以审查;

2、请求依法撤销被申请人作出的《北京市地方税务局第二稽查局税务处理决定书》(二稽税稽处【2011】63号)。

事实与理由:

被申请人经对申请人2000年11月29日至2010年12月31日纳税情况进行税务检查后,作出《北京市地方税务局第二稽查局税务处理决定书》(二稽税稽处【2011】63号)(以下简称“《处理决定书》”),要求申请人补缴营业税508,633.05元、城市维护建设税33,610.42元、教育费附加15,258.99元、企业所得税4,701,885.48元、印花税4,368.67元,对少缴的营业税加收滞纳金416,144.88元,对少缴的城市维护建设税加收滞纳金25,996.82元,对少缴的企业所得税加收滞纳金2,748,189.82元。

申请人认为,被申请人作出的关于补缴税款及对补缴的税款加收滞纳金的税务处理决定是错误的。具体理由如下:

一、程序错误

1、 公安提前介入,公安、税务联合行动,先抓人再查账,程序严重违法。

(1)事实

申请人首次接到被申请人的《纳税检查通知书》为2011年4月8日,然在此之前,相关人员艾未未、文涛、胡明芬等已被公安机关关押。2011年4月8日之后,公安机关又相继关押刘正刚、张劲松等人。

2011年4月8日下午3点,被申请人及北京市公安机关查抄并扣押了申请人2005年至2010年的所有财务会计资料、合同和印章等物品,期间被申请人对艾未未司机张劲松作了询问笔录,并首次向申请人出具《税务检查通知书》和《询问通知书》,要求申请人法定代表人路青4月12日前往北京市地方税务局接受询问。

2011年4月12日上午9点半,在3次查抄、5名人员相继被“失踪”后,被申请人才对申请人法定代表人路青进行了第一次询问。

2011年5月20日,新华社发短讯称,“新华社记者从北京市公安机关获悉,经公安机关对艾未未涉嫌经济犯罪一案进行侦查,现已初步查明,艾未未实际控制的北京发课文化发展有限公司存在逃避缴纳巨额税款、故意销毁会计凭证等犯罪行为”。

2011年6月22日晚上,被关押81天后,艾未未被“取保候审”。当晚22时15分,新华网刊登中、英文短讯,“记者从北京市公安机关获悉:公安机关对艾未未涉嫌经济犯罪依法进行侦查,已查明其实际控制的北京发课文化发展有限公司存在逃避缴纳巨额税款、故意销毁会计凭证等犯罪行为。鉴于艾未未认罪态度好、患有慢性疾病等原因,且其多次主动表示愿意积极补缴税款,现依法对艾未未取保候审”。
http://news.xinhuanet.com/legal/2011-06/22/c_121571476.htm

以上事实说明,被申请人与公安机关的密切配合行为直接与申请人税案相关。

(2)程序错误一:公安提前介入逃避缴纳税款案

根据2009年2月28日修正的《中华人民共和国刑法》(以下简称“《刑法》”)第二百零一条第一款“纳税人采取欺骗、隐瞒手段进行虚假纳税申报或者不申报,逃避缴纳税款数额较大并且占应纳税额百分之十以上的,处三年以下有期徒刑或者拘役,并处罚金;数额巨大并且占应纳税额百分之三十以上的,处三年以上七年以下有期徒刑,并处罚金”,以及第二百零一条第四款“有第一款行为,经税务机关依法下达追缴通知后,补缴应纳税款,缴纳滞纳金,已受行政处罚的,不予追究刑事责任;但是,五年内因逃避缴纳税款受过刑事处罚或者被税务机关给予二次以上行政处罚的除外”之规定,税务行政处理已成为公安机关等启动司法程序的前置要件。

根据2010年5月7日实施的《最高人民检察院、公安部关于公安机关管辖的刑事案件立案追诉标准的规定(二)》第五十七条第一款之规定,“【逃税案(刑法第二百零一条)】逃避缴纳税款,涉嫌下列情形之一的,应予立案追诉: (一)纳税人采取欺骗、隐瞒手段进行虚假纳税申报或者不申报,逃避缴纳税款,数额在五万元以上并且占各税种应纳税总额百分之十以上,经税务机关依法下达追缴通知后,不补缴应纳税款、不缴纳滞纳金或者不接受行政处罚的;(二)纳税人五年内因逃避缴纳税款受过刑事处罚或者被税务机关给予二次以上行政处罚,又逃避缴纳税款,数额在五万元以上并且占各税种应纳税总额百分之十以上的;(三)扣缴义务人采取欺骗、隐瞒手段,不缴或者少缴已扣、已收税款,数额在五万元以上的 ”。申请人于2000年11月29日成立,在本次税案之前没有任何刑事、行政处罚记录,不存在“经税务机关依法下达追缴通知后,不补缴应纳税款、不缴纳滞纳金或者不接受行政处罚”的行为,不具备公安机关上述立案标准,故被申请人配合公安机关提前介入,通过抓人查账的方式,是超越、滥用职权的严重违法行为,因违反法定程序取得的证据亦不具备合法性,被申请人以此为依据做出的处理决定应当予以撤销。

(3)程序错误二:税、警联合办案

根据2001年7月9日施行的《行政执法机关移送涉嫌犯罪案件的规定》第十一条第一款“行政执法机关对应当向公安机关移送的涉嫌犯罪案件,不得以行政处罚代替移送”、第二款“行政执法机关向公安机关移送涉嫌犯罪案件前已经作出的警告,责令停产停业,暂扣或者吊销许可证、暂扣或者吊销执照的行政处罚决定,不停止执行”、第三款“依照行政处罚法的规定,行政执法机关向公安机关移送涉嫌犯罪案件前,已经依法给予当事人罚款的,人民法院判处罚金时,依法折抵相应罚金”之规定,司法机构已经立案的案件,行政机构不得再行处理,除非在移送前已经作出的处理。依此逻辑,若公安机关已介入此案,税务部门即应退出此案;若税务部门正受理此案,即意味着该案并未移送公安或不符合移送条件,公安机关就不应该在该案中出现。被申请人与公安机关联合办案,不仅仅是程序错误,还在于严重混淆了行政与司法的界限,完全背离了《行政执法机关移送涉嫌犯罪案件的规定》的立法宗旨。根据《中华人民共和国刑事诉讼法》第三条第一款“对刑事案件的侦查、拘留、执行逮捕、预审,由公安机关负责。检察、批准逮捕、检察机关直接受理的案件的侦查、提起公诉,由人民检察院负责。审判由人民法院负责”、第三条第二款“除法律特别规定的以外,其他任何机关、团体和个人都无权行使这些权力”之规定,被申请人没有权力介入侦查阶段,任何在侦查阶段的取证行为均属违法行为。

(4)程序错误三:被申请人证据材料取自于公安机关

被申请人声称,其部分材料取自于公安机关。

首先,根据前述论证,公安机关提前介入属于违反法定程序的行为。因此,即使公安机关持有部分涉案材料,其因程序违法,该材料不具有证据效力。因此,凡被申请人来自于公安机关的任何材料,同样不应具有证据效力。

其次,根据最高人民法院《关于行政诉讼证据若干问题的规定》(法释【2002】21号)第七十条“生效的人民法院裁判文书或者仲裁机构裁决文书确认的事实,可以作为定案依据”之规定,公安机关作为侦查机关,其收集的材料尚未经人民法院确认,被申请人不能将其作为定案依据。

2、被申请人在税务检查前,未依法履行告知义务

根据《税务稽查工作规程》(国税发【2009】157号)第二十二条第一款之规定,“检查前,应当告知被查对象检查时间、需要准备的资料等,但预先通知有碍检查的除外”。

然而,2011年4月6日深夜,在不存在任何有碍检查的情形下,被申请人未依法定程序告知申请人,擅自到申请人委托记账的互信公司,调取了申请人自2000年公司成立至2011年2月的会计资料。

3、被申请人未依法出具税务检查证和《税务检查通知书》

根据《中华人民共和国税收征收管理法》(以下简称“《征管法》”)第五十九条“税务机关派出的人员进行税务检查时,应当出示税务检查证和税务检查通知书,并有责任为被检查人保守秘密;未出示税务检查证和税务检查通知书的,被检查人有权拒绝检查”,以及《税务稽查工作规程》(国税发【2009】157号)第二十二条第二款“检查应当由两名以上检查人员共同实施,并向被查对象出示税务检查证和《税务检查通知书》”之规定,税务检查人员向被检查对象出示证件和税务法律文书是必备的法律程序。

然而,在2011年4月6日深夜,被申请人向互信公司调取会计资料时,却并未履行法定程序,未出示税务检查证和《税务检查通知书》。

4、被申请人调取申请人会计资料严重违反法定程序

根据《税务稽查工作规程》(国税发【2009】157号)第二十五条之规定,“调取账簿、记账凭证、报表和其他有关资料时,应当向被查对象出具《调取账簿资料通知书》,并填写《调取账簿资料清单》交其核对后签章确认。”

但,被申请人到互信公司和申请人处调取会计资料时,均未依上述规定出具《调取账簿资料通知书》,更未填写《调取账簿资料清单》并交申请人核对确认。

5、被申请人调取申请人会计资料未在法定时限内退还

根据《中华人民共和国税收征收管理法实施细则》(以下简称“《征管法细则》”)第八十六条“税务机关行使税收征管法第五十四条第(一)项职权时,可以在纳税人、扣缴义务人的业务场所进行;必要时,经县以上税务局(分局)局长批准,可以将纳税人、扣缴义务人以前会计年度的账簿、记账凭证、报表和其他有关资料调回税务机关检查,但是税务机关必须向纳税人、扣缴义务人开付清单,并在3个月内完整退还;有特殊情况的,经设区的市、自治州以上税务局局长批准,税务机关可以将纳税人、扣缴义务人当年的账簿、记账凭证、报表和其他有关资料调回检查,但是税务机关必须在30日内退还”,以及《税务稽查工作规程》(国税发【2009】157号)第二十五条第二款“调取纳税人、扣缴义务人以前会计年度的账簿、记账凭证、报表和其他有关资料的,应当经所属税务局局长批准,并在3个月内完整退还;调取纳税人、扣缴义务人当年的账簿、记账凭证、报表和其他有关资料的,应当经所属设区的市、自治州以上税务局局长批准,并在30日内退还”之规定,被申请人向申请人调取以前年度会计资料,应在3个月内完整退还;被申请人向申请人调取当年的会计资料,应在30日内退还。

但,被申请人在上述法定时限届满时,并未依法退回所调取的全部会计资料,且时至今日,仍未退还,不仅严重影响了申请人的生产经营活动,且实质妨碍了申请人复议的权利。

综上,根据《中华人民共和国行政复议法》(以下简称“《行政复议法》”)第二十八条第一款第(三)项“具体行政行为有下列情形之一的,决定撤销、变更或者确认该具体行政行为违法;决定撤销或者确认该具体行政行为违法的,可以责令被申请人在一定期限内重新作出具体行政行为:3.违反法定程序的;4.超越或者滥用职权的”、《中华人民共和国行政复议法实施条例》第四十五条“具体行政行为有行政复议法第二十八条第一款第(三)项规定情形之一的,行政复议机关应当决定撤销、变更该具体行政行为或者确认该具体行政行为违法”,以及《税务行政复议规则》(国家税务总局令第21号)第五十五条“行政复议机关应当根据案件的具体情况,从以下方面审查证据的合法性:(一)证据是否符合法定形式。(二)证据的取得是否符合法律、法规、规章和司法解释的规定。(三)是否有影响证据效力的其他违法情形”、 第五十八条“下列证据材料不得作为定案依据:(一)违反法定程序收集的证据材料”之规定,被申请人对申请人作出的处理决定,应当具有充足的证据;而该等证据应当具备合法性,包括应当经过法定程序取得;如果被申请人违反法定程序收集证据的,则该等证据不得作为具体行政行为的事实依据。因被申请人实施具体行政行为时,存在着违反法定程序之行为,其具体行政行为应依法予以撤销。

也正是由于上述程序违法行为的存在,导致申请人无法查阅账簿、核对资料,实质妨碍了申请人对被申请人作出的《处理决定书》就事实部分进行陈述、质辩的复议权利。如果程序正义不张,无异于剥夺了另外一方说话的权利,也等于放纵行政机关就实体部分为所欲为。申请人强烈吁请复议机关恢复程序正义,返还申请人的财务、会计资料,以便为申请人就事实部分提出主张创造最基本的条件。这也是一个文明社会,所谓“文明人”“文明执法”的最基本底线。

二、处理决定适用依据不合法

《处理决定书》第二部分“处理决定”中“二(四)”部分载明,“根据《中华人民共和国企业所得税暂行条例》第一条、第二条、第三条、第四条、第五条;根据《中华人民共和国企业所得税法》第一条、第四条、第五条、第六条;《北京市地方税务局关于明确企业所得税若干政策业务问题的通知》(京地税企【2002】526号)第五条的相关规定,你单位应补缴企业所得税4701885.48元”。

上述《北京市地方税务局关于明确企业所得税若干政策业务问题的通知》(京地税企【2002】526号)第五条规定,“在税务检查中发现企业有隐匿收入,需补缴企业所得税时,其补缴的企业所得税的计算方法是:隐匿的收入扣除补缴的流转税及能够确认的与这部分收入相匹配的未扣除的成本、费用后,作为应补缴所得,再乘以被检查年度的所得税率计算补缴企业所得税额”。

上述京地税企【2002】526号文不具有合法性。

1、北京市地方税务局不具有“税务检查”的解释权

“税务检查”之规定,来源于全国人大常委会制定的《征管法》第四章“税务检查”之规定。根据《征管法》第九十三条“国务院根据本法制定实施细则”之规定,国务院可以通过制定细则的方式解释“税务检查”。因此,北京市地方税务局不是解释“税务检查”的适格主体。

即使依据《征管法细则》第八十五条第三款“税务检查工作的具体办法,由国家税务总局制定”之规定,北京市地方税务局也不是解释“税务检查”的适格主体。

2、北京市地方税务局不具有“企业所得税计算方法”的解释权

根据2008年1月1日前施行的《中华人民共和国企业所得税暂行条例》(以下简称“《企业所得税暂行条例》”)第十九条“本条例由财政部负责解释,实施细则由财政部制定”之规定,“企业所得税计算方法”应当由财政部解释,而不是北京市地方税务局。即使根据《中华人民共和国企业所得税暂行条例实施细则》第五十九条“本细则由财政部解释,或者由国家税务总局解释”之规定,“企业所得税计算方法”的解释权也不属于北京市地方税务局。

根据2008年1月1日起实施的《中华人民共和国企业所得税法》(以下简称“《企业所得税法》”)第五十九条“国务院根据本法制定实施条例”之规定,被申请人将京地税企【2002】526号文适用于2008年1月1日以后之情形,无异于代替国务院行使了企业所得税法的解释权。

3、京地税企【2002】526号文与上位法冲突

京地税企【2002】526号文第五条所谓“隐匿的收入扣除补缴的流转税及能够确认的与这部分收入相匹配的未扣除的成本、费用后,作为应补缴所得”的规定是错误的。

根据《企业所得税法》第五条“企业每一纳税年度的收入总额,减除不征税收入、免税收入、各项扣除以及允许弥补的以前年度亏损后的余额,为应纳税所得额”、第八条“企业实际发生的与取得收入有关的、合理的支出,包括成本、费用、税金、损失和其他支出,准予在计算应纳税所得额时扣除”,以及《中华人民共和国企业所得税法实施条例》第九条“企业应纳税所得额的计算,以权责发生制为原则,属于当期的收入和费用,不论款项是否收付,均作为当期的收入和费用;不属于当期的收入和费用,即使款项已经在当期收付,均不作为当期的收入和费用。本条例和国务院财政、税务主管部门另有规定的除外”之规定,所得税的计算依据是“应纳税所得额”,而不是京地税企【2002】526号文所创造的“应补缴所得”的概念。“应纳税所得额”的计算,应当扣除有关的、合理的支出,包括成本、费用、损失和其他支出,而不是京地税企【2002】526号文所谓的“相匹配的”“成本、费用”两项;“应纳税所得额”的计算,应当以权责发生制为原则,属于当期的费用,不论款项是否支付,均应准予扣除,而不是京地税企【2002】526号文所谓的人为的“能够确认的”原则。如果依据京地税企【2002】526号文,必然使申请人的成本、费用、损失和其他支出不能得到完整、真实、准确的反映,也使权责之间失去了平衡。

根据《中华人民共和国立法法》之规定,京地税企【2002】526号文既不属于法律,也不属于法规、规章,而属于地方人民政府工作部门的规定。根据《行政复议法》第七条第一款“公民、法人或者其他组织认为行政机关的具体行政行为所依据的下列规定不合法,在对具体行政行为申请行政复议时,可以一并向行政复议机关提出对该规定的审查申请:(二)县级以上地方各级人民政府及其工作部门的规定”之规定,因被申请人依据的京地税企【2002】526号文对申请人利益影响甚重,故申请人依法对京地税企【2002】526号文提出审查申请。

三、征收方式错误

由于程序障碍的存在,导致申请人无法具备条件查证《处理决定书》认定的所谓“事实”部分。暂不论“违法事实是否成立”, 仅就征收方式而言,从被申请人作出的《处理决定书》引用的依据可知,被申请人所采用的征收方式为“查账征收”而非“核定征收”。申请人认为被申请人征收方式存在错误:

1、“查账征收”的前提条件欠缺

根据《刑法》第二百零一条第四款之规定,在税务部门作出追缴通知、清缴税款之前,公安机关不能提前介入“逃避缴纳税款”(即《征管法》六十三条之“偷税”)案,而公安机关提前介入此案的理由限于“隐匿、故意销毁会计凭证、会计账簿、财务会计报告”。被申请人也自称其资料来源于公安机关,则由此表明被申请人取得的是账册不全的资料,而依据账册不全的资料进行征税显然不满足“查账征收”的条件。

2、账册不全的情况下,应当也只能依法采用“核定征收”。

根据《征管法》第三十五条“纳税人有下列情形之一的,税务机关有权核定其应纳税额:(四)虽设置账簿,但账目混乱或者成本资料、收入凭证、费用凭证残缺不全,难以查账的”,以及《企业所得税核定征收办法(试行)》(国税发【2008】30号)第三条“纳税人具有下列情形之一的,核定征收企业所得税:(四)虽设置账簿,但账目混乱或者成本资料、收入凭证、费用凭证残缺不全,难以查账的”之规定,如果申请人客观上存在着收入、费用难以通过账簿、凭证、资料等查实的,依法应当并且也只能采用“核定征收”方式,而非错误地采用“查账征收”方式。

对于此类情形应当适用核定征收方式,不仅《企业所得税核定征收办法(试行)》(国税发【2008】30号)作出了规定,各地税务部门在征管实践中也有类似规定。例如,《北京市地方税务局关于印发〈北京市地方税务局企业所得税核定征收暂行办法〉的通知》(京地税企【2004】569号)第四条规定,“我市地方税务局征管范围内缴纳企业所得税的纳税人,具有下列情形之一的,应实行核定征收方式征收企业所得税:四、虽设置帐簿,但帐目混乱或者成本资料、收入凭证、费用凭证残缺不全,难以查帐的”。尽管该文件已经废止,但关于“核定征收”的具体要求和情形,与前述《企业所得税核定征收办法(试行)》(国税发【2008】30号)一脉相承。又如,《广州市地方税务局关于印发〈广州市地方税务局核定征收企业所得税暂行办法〉的通知》(穗地税发【2005】297号)第五条明文规定,“纳税人有下列情形之一的,税务机关有权核定征收企业所得税:(三)虽设置帐簿,但帐目混乱或者成本资料、收入凭证、费用凭证残缺不全,难以查帐的,包括:1.只能准确核算收入总额或收人总额能够查实,但其成本费用支出不能准确核算的;3.收入总额及成本费用支出均不能正确核算,不能向主管税务机关提供真实、准确、完整纳税资料,难以查实的”。可见,在收入总额能够查实,但成本费用支出不能准确核算和查实,以及收入总额和成本费用支出均无法准确核算和查实的情况下,对纳税人应当并且只能实行“核定征收”,“查帐征收”不应适用,其实也无法适用。

3、被申请人未能通过“查账征收”方式核实申请人客观存在的成本、费用、损失等合理支出。

在本案中,被申请人认定申请人自“2000年11月29日至2010年12月31日”“取得设计费及工程款收入15823724.36元未在账簿中记载”,并以此作为计算补缴营业税、城市维护建设税和教育费附加及企业所得税的基础。姑且不论被申请人所认定之申请人相应项目的收入总额是否真实存在、准确,仅就该等据以确认收入之项目的成本、费用而言,被申请人显然并未核实。

根据《处理决定书》第一条“违法事实”第(五)部分内容,被申请人认定申请人2002年“应缴纳企业所得税318590.85元,已缴纳企业所得税4008.77元”,2003年“应缴纳企业所得税33115.57元,已缴纳企业所得税1128.38元”,2006年“应缴纳企业所得税1191377.86元,已缴纳企业所得税2301.18元”,2007年“应缴纳企业所得税1954777.47元,已缴纳企业所得税14571.54元”,2008年“应缴纳企业所得税1071895.35元,已缴纳企业所得税9600.42元”,2009年“应缴纳企业所得税172493.33元,已缴纳企业所得税8754.66元”。据此计算,被申请人认定之申请人涉嫌少缴企业所得税的应纳税所得额合计为15,437,018.88元,这与被申请人认定的申请人未入账收入“15823724.36元”仅相差386,705.48元。据此推断,被申请人认定申请人取得项目收入“15823724.36元”,但其所发生的成本、费用和支出却只有386,705.48元,则申请人相关项目的毛利润率竟高达97%,其荒谬与擅断由此可见。

以上数据充分说明,被申请人并未查实所谓项目收入“15823724.36元”对应的成本、费用等合理支出,而是藉前述京地税企【2002】526号文为遮掩,以被申请人自己“确认的”386,705.48元作为扣除草率了事。

既然被申请人无法查实相应的成本、费用等,就应该严格遵循《征管法》、《企业所得税核定征收办法(试行)》(国税发【2008】30号)等相关法律、规范性文件关于应实行“核定征收”之规定,而不应强行按照“查账征收”方式以非达一个既定的目的不可。

4、无论“核定征收”还是“查账征收”,被申请人均应当合理的确定申请人的支出。

税务机关在稽查过程中,除了应当积极查实纳税人可能隐匿之收入等事实外,并负有责任查清纳税人与生产经营相关的成本、费用、税金、损失、其他支出等支出事实。

如,《内蒙古自治区地方税务局关于所得税若干业务问题的批复》(内地税【2006】180号)第一条第(三)项规定,“企业因无法取得发票造成的原材料不能真实核算和白条入帐问题。国家税务总局所得税管理司在《关于纳税人购进原材料未按规定取得发票税前扣除有关问题的签报》中对此问题提出如下处理意见:对于发票使用不规范,但经济业务实际发生,有关费用也属于允许扣除范围的,税务机关可以要求纳税人重新提供规范发票或其他能够证实费用真实性及准确计算费用金额的适当凭据,即使纳税人不能提供相关证据,税务机关也有责任采取其他合理方法核定有关费用的金额、比例。”因此,根据内蒙古自治区地方税务局转述的国家税务总局之规定,税务机关有责任查明纳税人与其生产经营相关之成本、费用、损失等支出的具体数额。即使该纳税人不提供相关成本、费用等的规范发票,但却能够提供“其他能够证实费用真实性及准确计算费用金额的适当凭据”的情况下,比如业务发生的合同、付款凭证、收款收据、收款方的证人证言等,税务机关即应当予以认定该等成本、费用等。如果纳税人不能提供相关证据的情况下,税务机关也有责任按照合理的方式“核定”有关成本、费用,而不能按照“查账征收”方式视为纳税人未发生成本或由税务局自行“确认”成本。

四、“装饰”收入不属于申请人的应税收入

被申请人将“装饰收入”归之于申请人,暂且不论其主体,仅就该收入之性质而言,即使归并于申请人,亦属于非应税收入。

1、申请人不具备“承接住宅室内装饰装修工程的装饰装修企业”之建筑企业资质证书,不存在取得“装饰收入”的可能。

根据《住宅室内装饰装修管理办法》(建设部令第110号)第二十二条 “承接住宅室内装饰装修工程的装饰装修企业,必须经建设行政主管部门资质审查,取得相应的建筑业企业资质证书,并在其资质等级许可的范围内承揽工程”之规定,申请人不属于上述建筑企业,也不具有相应资质,即不具备取得“装饰收入”的权利能力。

2、若被申请人执意将该收入归之于申请人,该收入性质则只能认定为“违法所得”。

违法所得是否具有“可税性”,不论学理上如何解释,但就中国已形成的法律体系而言,仅需依据“法定”原则即可做出判断。根据《征管法》第四条“法律、行政法规规定负有纳税义务的单位和个人为纳税人”,以及第三十七条“对未按照规定办理税务登记的从事生产、经营的纳税人以及临时从事经营的纳税人,由税务机关核定其应纳税额,责令缴纳;不缴纳的,税务机关可以扣押其价值相当于应纳税款的商品、货物。扣押后缴纳应纳税款的,税务机关必须立即解除扣押,并归还所扣押的商品、货物;扣押后仍不缴纳应纳税款的,经县以上税务局(分局)局长批准,依法拍卖或者变卖所扣押的商品、货物,以拍卖或者变卖所得抵缴税款”之规定,《征管法》对“违法所得”行使征税权仅限于无照经营之情形,如果超出这一情形,又无税收法律、法规之另有规定,则不能擅自扩展。显然,“超出经营范围”的行为并不能等同于《征管法》第三十七条之“未按照规定办理税务登记”的行为。

3、税务部门对该等行为的处理超越了自身职能范围,侵犯了其他职能部门的行政权力。

根据《中华人民共和国建筑法》第六条“国务院建设行政主管部门对全国的建筑活动实施统一监督管理”,以及第六十五条第三款“未取得资质证书承揽工程的,予以取缔,并处罚款;有违法所得的,予以没收”之规定,即使按被申请人之逻辑将该等收入归并于申请人,但对于“未取得资质证书承揽工程的”收入,其监督管理权限、处罚权限,属于国务院建设行政管理部门,而不是税务部门。

五、《处理决定书》欠缺法定内容

根据《税务稽查工作规程》(国税发【2009】157号)第五十六条之规定,“《税务处理决定书》应当包括以下主要内容:(六)税款滞纳时间、滞纳金计算方法、缴纳期限及地点”。

但,被申请人在《处理决定书》第二部分“处理决定”中“二(六)滞纳金”,仅释明了法律依据(即《征管法》第三十二条),却未明确“税款滞纳时间”和“滞纳金计算方法”,以致申请人对“416144.88元”、“25996.82元”、“2748189.82元”的滞纳金数额难以知其所以然。

综上,为维护申请人的合法权益,维系税企双方正常的征纳关系,并维护国家税法及税收执法的公平、公正,申请贵局将被申请人所依据的《北京市地方税务局关于明确企业所得税若干政策业务问题的通知》(京地税企【2002】526号)予以审查,并请贵局查明事实、依法撤销被申请人作出的《北京市地方税务局第二稽查局税务处理决定书》(二稽税稽处【2011】63号)。

此致

北京市 地方税务局

申请人:北京发课文化发展有限公司

法定代表人:路青

2012年1月12日

英译:https://plus.google.com/u/0/106372800511710859472/posts/Ey8qyfM1sXg



Application for Administrative Reconsideration

Applicant: Fake Design Culture Development Ltd.

Address: No. 258 Caochangdi Village, Cuigezhuang Township, Chaoyang District, Beijing (Zip: 100015)

Legal representative: Lu Qing

Respondent: The Second Investigation Branch of Beijing Local Taxation Bureau

Application Items:

1. As the Notification of Beijing Local Taxation Bureau on Definition of Several Policy Business Issues on Enterprise Income Tax (Jing Di Shui Qi [2006] No. 526) that the respondent has cited is an illegal basis, we hereby apply for review of this regulation;

2. We request cancellation of the Written decision on administrative settlement of the Second Investigation Branch of Beijing Local Taxation Bureau (Er Ji Shui Ji Chu [2011] No. 63) issued by the respondent, in accordance with the law.

Facts and Reasons:

After the respondent’s tax investigation into the applicant’s taxation situation from November 29, 2011 to December 31, 2010, the respondent issued the Written decision on administrative settlement of the Second Investigation Branch of Beijing Local Taxation Bureau (Er Ji Shui Ji Chu [2011] No. 63) (hereinafter referred to as the written decision on punishment), requiring the applicant to make a supplementary payment of 508,633.05 yuan in business tax, 33,610.42 yuan in urban maintenance and construction tax, 15,258.99 yuan in education fees, 4,701,885.48 yuan in enterprise income tax, 4,368.67 yuan in stamp duty, and additional late fees of 416,144.88 yuan for underpaid business tax, 25,996.82 yuan for underpaid maintenance and construction tax, and 2,748,189.82 yuan for underpaid enterprise income tax.

The applicant believes that the decision on tax settlements made by the respondent on supplementary of taxes and imposing late fees on repaid taxes is wrong, due to the following reasons:


I. Procedural Errors

1. Early intervention by the public security department, joint action between the public security and taxation departments, making arrests before auditing, such procedures are in grave violation of the law.

(1) Facts

The applicant received a Tax Inspection Notice from the respondent for the first time on April 8, 2011. However, persons concerned including Ai Weiwei, Wen Tao and Hu Mingfen had already been detained by public security organs before this date. After April 8, 2011, the public security organs further detained Liu Zhenggang and Zhang Jinsong.

At 15:00 on April 8, 2011, the respondent and Beijing public security organs raided and seized all financial and accounting data from 2005 to 2010, including contracts, seals and other items belonging to the applicant. Meanwhile, the respondent interrogated Zhang Jinsong, the driver of Ai Weiwei, and wrote reports. For the first time, the Tax Inspection Notice and the Inquiry Notice were presented to the applicant, requiring Lu Qing, the applicant’s legal representative, to visit the Beijing Local Taxation Bureau on April 12 for questioning.

At 9:30 on April 12, 2011, only after three raids and “disappearances” of five persons, the respondent conducted the questioned Lu Qing, the legal representative of the applicant, for the first time.

On May 20, 2011, Xinhua News Agency made a short announcement stating that "A company under the control of artist Ai Weiwei was found to have evaded "a huge amount" of tax, the Beijing police authorities said on Friday. The Beijing Fake Cultural Development Ltd. was also found to have intentionally destroyed accounting documents, the police authorities told Xinhua, citing an initial investigation."

On the evening of June 22, 2011, after being detained for 81 days, Ai Weiwei was released “on bail pending trial”. At 22:15 that night, Xinhuanet published a short message in both Chinese and English, "The Beijing police department said Wednesday that Ai Weiwei has been released on bail because of his good attitude in confessing his crimes as well as a chronic disease he suffers from. The decision comes also in consideration of the fact that Ai has repeatedly said he is willing to pay the taxes he evaded, police said. The Beijing Fake Cultural Development Ltd., a company Ai controlled, was found to have evaded a huge amount of taxes and intentionally destroyed accounting documents, police said". http://news.xinhuanet.com/legal/2011-06/22/c_121571476.htm)

The above facts demonstrate that the close cooperation between the respondent and the public security organs are directly related to the tax case of the applicant.

(2) Procedural mistake I: Early intervention of the tax evasion case by public security organs

According to paragraph 1, Article 201 of the Criminal Law of the People’s Republic of China as amended on February 28, 2009 (hereinafter referred to as Criminal Law), “Where any taxpayer files false tax returns by cheating or concealment or fails to file tax returns, and the amount of evaded taxes is relatively large and accounts for more than 10 percent of payable taxes, he shall be sentenced to fixed-term imprisonment not more than three years or criminal detention, and be fined; or if the amount is huge and accounts for more than 30 percent of payable taxes, shall be sentenced to fixed-term imprisonment not less than three years but not more than seven years, and be fined”, and paragraph 4, Article 201, “Where any taxpayer who committed the act as described in paragraph 1 has made up the payable taxes and paid the late fine after the tax authority sent down the notice of tax recovery according to law, and has been administratively punished, he shall not be subject to criminal liability, except one who has been criminally punished in five years for evading tax payment or has been, twice or more, administratively punished by the tax authorities”, tax administrative treatment has become a prepositional condition for the public security organs to initiate a judicial procedure.

According to Paragraph 1 of Article 57 of the Notice of the Supreme People’s Procuratorate and the Ministry of Public Security on Issuing the Provisions (II) of the Supreme People’s Procuratorate and the Ministry of Public Security on the Standards for Filing Criminal Cases under the Jurisdiction of the Public Security Organs for Investigation and Prosecution promulgated on May 7, 2010, “【Tax evasion case (Article 201 of the Criminal Law)】For any tax evasion suspected of one of the following circumstances, a case will be filed for investigation and prosecution: (1) Any taxpayer files false tax returns by cheating or concealment or fails to file tax returns to evade taxes, with the amount of evaded taxes more than 50,000 yuan and accounting for more than 10 percent of payable taxes, does no make up the payable taxes and does no pay the late fine after the tax authority sent down the notice of tax recovery according to law, and refuses to be administratively punished; (2) Any taxpayer has been criminally punished in five years for evading tax payment or has been, twice or more, administratively punished by the tax authorities, and has evaded taxes, with the amount of evaded taxes more than 50,000 yuan and accounting for more than 10 percent of payable taxes; (3) Where any withholding agent fails to pay or fails to pay in full the withheld or collected taxes by cheating or concealment, and the amount is more than 50,000 yuan”. The applicant was established on November 29, 2000, had no criminal and administrative punishment records before this tax case, and did not commit the actions of “failing to make up the payable taxes and failing to pay the late fine after the tax authority sent down the notice of tax recovery according to law, or refusing to be administratively punished”. As the requirements for case establishment could not be met as described above, the respondent’s act of cooperating with the public security department’s early intervention, making arrests and inspecting taxes afterwards, is a grave violation of the law and an abuse of powers. Evidences obtained by means of violating proper procedures are illegitimate, therefore the decision for administrative punishment by which the respondent has made shall be withdrawn.

(3) Procedural mistake II: tax authorities and public security organs joining forces on case handling

According to Paragraph 1 of Article 11 of the Provisions on the Transfer of Suspectable Criminal Cases by Administrative Organs for Law Enforcement promulgated on July 9, 2001, “For any suspectable criminal cases that administrative organs for law enforcement were to transfer to the public security department, administrative punishments shall not serve as substitutes for the transfer”, Paragraph 2, “Any warning or administrative punishment decisions such as orders to cease production or operation, suspension or revocation of permits, suspension or revocation of licences, made by the administrative organs for law enforcement before the transfer of a suspectable criminal case to the public security organ shall not be discontinued”, and Article 3, “According to the regulations of the administrative punishment law, before the transfer of a suspectable criminal case to the public security organs, when the people’s court imposes a fine on the party at the occasion that an administrative organ has already made a previous decision, the amount of fine imposed by the former shall be made the same as that by the latter”, a case that has already been established by a judicial institution shall not be handled additionally by the administrative organ unless it is a decision already made before the transfer. In accordance with this logic, if the public security organs have already been involved in the case, then the tax authorities shall withdraw from it; if the tax authorities are handling the case, it implies that the case has not been transferred to the public security department or the conditions for transfer are not met, then the public security department should not be involved in the case. It is not only a procedural mistake for the respondent and the public security organs to join forces in handling a case, it is also a serious confusion of administrative and judicial boundaries, thoroughly deviating from the legislative purpose of the “Provisions on the Transfer of Suspectable Criminal Cases by Administrative Organs for Law Enforcement”. According to Paragraph 1 of Article 3 of the Criminal Procedure Law of the People’s Republic of China, “The public security organs shall be responsible for investigation, detention, execution of arrests and preliminary inquiry in criminal cases. The People’s Procuratorate shall be responsible for procuratorial work, authorizing approval of arrests, conducting investigation and initiating public prosecution of cases directly accepted by the procuratorial organs. The People’s Courts shall be responsible for adjudication.”, and Paragraph 2 of Article 3, “Except as otherwise provided by law, no other organs, organizations and individuals shall have the authority to exercise such powers.”, the respondent has no authority to intervene at the investigation stage and any evidence collecting action during the investigation stage is illegal.

(4) Procedural mistake 3: The respondent has obtained evidence materials from the public security organs

The respondent claimed that some of its materials are taken from the public security organs.

Firstly, according to the aforementioned argument, early intervention by the public security organs is a breach of statutory procedures. Therefore, even if the public security organs hold materials relevant to the case, the materials are illegitimate because of the procedural errors. Thus, any and all materials that the respondent obtained from public security organs should be deemed illegitimate.

Secondly, according to Article 70 of Several Provisions of the Supreme People’s Court on Evidence in Administrative Procedures (Fa Shi [2002] No. 21), “Any fact identified by a valid judicial document of the people's court or verified by a document of the arbitration body can be used as basis for a verdict.”, the materials collected by the public security organs as investigating authorities, which have not been confirmed by the people’s court, shall not be used by the respondent as basis for a verdict.

2. Before the tax inspection, the respondent did not fulfill its obligations for notifications in accordance with the law

According to Article 22 (1) of the Tax Investigation Rules (Guo Shui Fa [2009] No. 157), “Before inspection, the inspected party shall be informed of the inspection time and materials to be prepared, unless prior notice impedes the inspection”.

However, late at night on April 6, 2011, when there was no obstacle to inspection, the respondent failed to inform the applicant according to legal procedures and retrieved the accounting materials of the applicant from the founding time of the company, the year 2000, to February 2011, from Beijing Huxin Financial Accounting Services Co., Ltd. (hereinafter referred to as Huxin Company), to which the applicant entrusts for bookkeeping.

3. The respondent failed to present a tax inspection certificate and the Tax Inspection Notice in accordance with the law

According to Article 59 of The Law of the People’s Republic of China Concerning The Administration of Tax Collection (hereinafter referred to as ‘Tax Administration Law’) “When conducting tax inspection, the officials sent by the tax authorities shall produce tax inspection certificate and tax inspection notice, and shall have the duty to keep confidentiality for the persons under inspection; where no such certificate and notice are produced, the persons subject to inspection shall have the right to refuse to accept the inspection” and Article 22 (2) of the Tax Investigation Rules (Guo Shui Fa [2009] No. 157), “The inspection shall be executed by two or more inspectors, who should show the inspected object the tax inspection certificate and the Tax Inspection Notice”, it is a necessary legal procedure for the tax inspectors to show the inspected party the certificates and tax legal documents.

However, late at night on April 6, 2011, when retrieving accounting materials from Huxin Company, the respondent failed to present the tax inspection certificate and the Tax Inspection Notice, hence violating the legal procedure.

4. The respondent was in grave violation of legal procedures when retrieving the applicant’s accounting information

According to Article 25 of the Tax Investigation Rules (Guo Shui Fa [2009] No. 157), “When retrieving account books, accounting vouchers, statements and other relevant information, one must present the Notice for Retrieval of Accounting Materials to the inspected party and fill out the List of Retrieved Accounting Materials, which shall be signed for confirmation after being checked with the inspected party.

However, when retrieving accounting materials from Huxin Company and the applicant, the respondent failed to present the Notice for Retrieval of Accounting Materials and to fill out the List of Retrieved Accounting Materials, which had not been checked with the applicant.

5. The respondent had not returned retrieved account materials belonging to the applicant within the statutory time limit

According to Article 86 of Rules for the Implementation of the Law of the People’s Republic of China on the Administration of Tax Collection (hereinafter referred to as Tax Adminstration Rules), “A taxation authority exercising its powers of office provided under the provisions of item (1) of Article 54 of the Tax Administration Law may do so at the business premises of a taxpayer or tax-withholding agent. If deemed necessary and subject to approval by the head of a taxation authority at county level or above, the taxation authority may also demand that the taxpayer's or tax withholding agent's account books, accounting documentation, statements and other relevant materials of the previous accounting year be submitted for examination. When doing so, however, the taxation authority must provide the taxpayer or tax withholding agent with a detailed list of the items taken and shall return them within three months; in special cases, and subject to approval by the head of a taxation authority at city and autonomous prefecture level or above, the taxation authority may take back the taxpayer's or tax withholding agent's account books, accounting documentation, statements and other relevant materials of the current accounting year for examination, which must be returned by the taxation authority within 30 days”, and Article 25 (2) of the Tax Investigation Rules (Guo Shui Fa [2009] No. 157), “Retrieval of the taxpayer's or tax withholding agent's account books, accounting documentation, statements and other relevant materials of the previous accounting year shall be approved by the head of a taxation authority and they shall be returned within three months; retrieving of the taxpayer's or tax withholding agent's account books, accounting documentation, statements and other relevant materials of the current accounting year shall be subject to approval by the head of a taxation authority at city and autonomous prefecture level or above and they must be returned within 30 days”, any accounting materials of the previous accounting year retrieved by the respondent from the applicant shall be returned completely within three months; any accounting materials of the current accounting year retrieved by the respondent from the applicant shall be returned within 30 days.

However, the respondent did not return all the retrieved accounting materials according to the law when the statutory time limit has expired, and as of now, they still have not been returned. It does not only affects the applicant's production and business activities seriously, it also substantially impedes the applicant’s rights to an administrative review.

Considering the above, and subjected to Paragraph 1(c) of Article 28 of the Administrative Reconsideration Law of the People's Republic of China (hereinafter referred to as Administrative Reconsideration Law), “If a specific administrative act has been undertaken in one of the following circumstances, the act shall be annulled, altered, or confirmed as illegal by decision; if the specific administrative act is annulled or confirmed as illegal by decision, the applied may be ordered to undertake a specific administrative act anew within a fixed time: 3. violation of legal procedures; 4. excess of authority or abuse of powers”, Article 45 of the Regulation on the Implementation of the Administrative Reconsideration Law of the People’s Republic of China, “Where a specific administrative action is under any of the circumstances set forth in Paragraph 1 (c) of Article 28 of the Administrative Reconsideration Law, an administrative reconsideration organ shall decide to revoke or modify the specific administrative action or confirm the specific administrative action as a violation of law”, and Article 55 of the Rules for Taxation Administrative Reconsideration (No. 21 Decree of the State Administration of Taxation), “The administrative reconsideration agency shall examine the legitimacy of the evidences in the following respects according to the specific situations of a case:

  (1)Whether the evidences conform to the legal form; (2)Whether the obtaining of evidences conforms to the provisions of laws, regulations and judicial interpretations; and (3)Whether there are other circumstances in violation of laws which may affect the force of evidences”, and Article 58 “The following evidentiary materials shall not be used as the basis for determination of a case:

  (1) Any evidentiary material collected by any means in violation of legal procedures”, the punishment decision made by the respondent to the applicant should have sufficient evidence; and such evidence should have legitimacy, including that they were to be obtained through legal procedures; furthermore, if the respondent collects evidence in violation of legal procedures, such evidence shall not be used as the factual basis for specific administrative act; moreover, if the respondent commits an action in violation of legal procedures when implementing the specific administrative act, its specific administrative act shall be revoked according to law. In terms of the respondent in the present case, its law enforcement has committed serious violation of legal procedures and excess of authority or abuse of powers, and thus its penalty decision should of course be revoked according to law.

It is due to the presence of violations in procedures, that the applicant has no access to its accounting records and to verify data. It has substantially impeded the applicant’s rights to present its case and to defend itself against the facts as claimed in the written decision of punishment that the respondent has issued to the applicant. If there is no justice in procedures, it is tantamount to stripping off the other party’s right to speak, and is equivalent to tolerating power abuse on the part of administrative institutions. The applicant strongly urges the institution in charge of the reconsideration to exercise justice in its procedures, to return financial and accounting records to the applicant, in order to provide the most basic conditions for the applicant to develop its position based on facts. This is a civilized society, and this is the basic bottom line for “civilized people” to carry out “civilized law enforcement”.

II. Violations in legal basis applied for the written decision for settlement
Item 2(4) of the settlement decision in Part 2 of the “Settlement Decision” states that “According to Articles 1, 2, 3, 4 and 5 of the Provisional Regulations of the People's Republic of China on Enterprise Income Tax, Articles 1, 4, 5 and 6 of the Law of the People's Republic of China on Enterprise Income Tax, Article 5 of the Notification of Beijing Local Taxation Bureau on Definition of Several Policy Business Issues on Enterprise Income Tax (Jing Di Shui Qi [2006] No. 526), your company shall repay 4701885.48 yuan in enterprise income tax.”

The above-stated Article 5 of the Notification of Beijing Local Taxation Bureau on Definition of Several Policy Business Issues on Enterprise Income Tax (Jing Di Shui Qi [2006] No. 526) stipulates that "If in a tax inspection, a company has been found to have hidden income and repayment of the enterprise income tax is required, the method for calculation of the enterprise income tax to be repaid is: the hidden income, minus the turnover tax to be repaid and identifiable undeducted costs and expenses matching this part of income, should be used as the income for repayment of tax, and is multiplied by the enterprise income tax rate of the inspection year to figure out the amount of enterprise income tax to be repaid”.

The above (Jing Di Shui Qi [2006] No. 526) document does not have legitimacy.

1. The Beijing Local Taxation Bureau does not have the right to interpret the definition of a “tax inspection”.

The regulations on "Tax Inspection" come from Chapter 4 “Tax Inspection” of the Tax Administration Law enacted by NPC Standing Committee. According to Article 93 of the Tax Administration Law, “The detailed rules for implementation of this Law shall be formulated by the State Council in accordance with this Law", the State Council may interpret the “Tax Inspection” by formulation of detailed rules. Therefore, Beijing Local Taxation Bureau is not an appropriate body to explain "Tax Inspection".

Even if based on Paragraph 3, Article 85 of the Rules for the Implementation of the Law of the People’s Republic of China on the Administration of Tax Collection, “The specific measures for tax inspection shall be formulated by the State Administration of Taxation", Beijing Local Taxation Bureau is not an appropriate main body to explain "Tax Inspection" either.

2. The Beijing Local Taxation Bureau does not have the right to interpret the "Method for calculating enterprise income tax"

According to Article 19 of the Provisional Regulations of the People's Republic of China on Enterprise Income Tax (hereinafter referred to as Provisional Regulations on Enterprise Income Tax) implemented before January 1, 2008, “The Ministry of Finance shall be responsible for the interpretation of these Regulations. The rules for the implementation of these Regulations shall be determined by the Ministry of Finance", the "Method for calculating enterprise income tax" shall be interpreted by the Ministry of Finance instead of by Beijing Local Taxation Bureau. Even if based on Article 59 of Provisional Regulations on Enterprise Income Tax, “The detailed rules are interpreted by the Ministry of Finance or by the State Administration of Taxation", the "Method for calculating enterprise income tax" shall not be interpreted by Beijing Local Taxation Bureau.

According to Article 59 of the Enterprise Income Tax Law of the People's Republic of China promulgated on January 1, 2008 (hereinafter referred to as the Enterprise Income Tax Law), “The State Council shall formulate a regulation on the implementation of this Law”, the respondent applies its Jing Di Shui Qi [2002] No. 526 Document to the situation after January 1, 2008, meaning that it has interpreted the Enterprise Income Tax Law in lieu of the State Council.

3. Jing Di Shui Qi [2002] No. 526 Document conflicts with a higher-level law

The regulation of Article 5 of Jing Di Shui Qi [2002] No. 526 Document, “The hidden income, minus the turnover tax to be repaid and identifiable undeducted costs and expenses matching this part of income, should be used as the income for repayment of tax” is mistaken.

According to Article 5 of the Enterprise Income Tax Law, “The balance after deducting tax-free incomes, tax-exempt incomes, all deduction items as well as permitted remedies for losses of the previous year(s) from an enterprise's total amount of incomes of each tax year shall be the taxable amount of incomes” and Article 8, “The reasonable disbursements that are actually incurred and in which have actual connection with the business operations of an enterprise, including the costs, expenses, taxes, losses, etc., may be deducted in the calculation of the taxable amount of incomes” and Article 9 of the Regulation on the Implementation of the Income Tax Law of the People’s Republic of China, “The calculation of the taxable amount of an enterprise shall be based on the principles of the accrual method of accounting. The current incomes and expenditures shall be treated as current incomes and expenditures notwithstanding whether they have been received or paid; incomes and expenditures that are not current shall not be treated as current incomes and expenditures even the payment in question has been currently made, unless it is otherwise provided for by the present Regulation or the competent department of treasury or taxation of the State Council.”, the basis for calculation of income tax shall be “taxable amount” instead of the concept of “repayable income” created by Jing Di Shui Qi [2002] No. 526 Document. In calculation of “taxable amount”, relevant and reasonable expenditures including costs, expenses, losses and other expenditures shall be deducted, instead of the so-called “matching” two items “costs and expenses” in Jing Di Shui Qi [2002] No. 526 Document; The calculation of “the taxable amount” of an enterprise shall be based on the principles of the accrual method of accounting. The current incomes and expenditures shall be treated as current incomes and expenditures notwithstanding whether they have been paid, and shall not be based on the so called man-made “identifiable” principle in Jing Di Shui Qi [2002] No. 526 Document. If Jing Di Shui Qi [2002] No. 526 Document is based on, it is inevitable that the costs, expenses, losses and other expenditures of the applicant cannot be reflected on a complete, true and accurate basis, and balance is lost between rights and liabilities.

According to the Legislation Law of the People's Republic of China, Jing Di Shui Qi [2002] No. 526 Document is neither a law, a statute, nor a rule but a regulation of a working department of the local people’s government. According to Paragraph 1, Article 7 of the Administrative Reconsideration Law, a citizen, legal representative or any other organization believes that an administrative organ has violated any of the following provisions in their administrative action may concurrently lodge an application to the administrative reconsideration organ for a review of such provision with an application for administrative reconsideration of the specific administrative action: (2)Regulations of people’s governments above county level and their working departments”, Jing Di Shui Qi [2002] No. 526 Document that the respondent is base on has posed very serious influence on the interests of the applicant, thus the applicant lodges an application for a review of Jing Di Shui Qi [2002] No. 526 Document by law.

III. Wrong collection methods

The presence of procedural hindrance renders the applicant unable to have the so-called “facts” verified in the Settlement Decision. Regardless of “whether the fact of a legal violation exists”, in terms of the collection method alone, according to the basis cited by the respondent in the Settlement Decision, the respondent uses “audit collection” method instead of “verification collection”. The applicant believes that there are errors in the method that the respondent has used.

1. Insufficient preconditions for “audit collection”

According to Paragraph 4 of Article 201 of the Criminal Law, before the tax authorities issue a recovery notice to settle taxes, the public security department cannot intervene in any case of “evasion of tax payment” (i.e. “Tax Evasion” in Article 63 of the Tax Administration Law) in advance. The reason for early intervention by the public security department in this case is limited to “hiding and intentional destruction of accounting vouchers, account books and financial and accounting reports.” The respondent also claimed its materials coming from the public security department, this indicating that the account books obtained by the respondent are incomplete materials, and tax collection based on incomplete accounting records is clearly insufficient for the requirements of an “audit collection”.

2. When accounting records are incomplete, the “verification collection”

method should be applied, and only such method may be applied, in accordance with the law

According to Article 35 of the Tax Administration Law, “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:(4) where account books are established, but the accounts are not in order or information on costs, receipt vouchers and expense vouchers is incomplete, making it difficult to check the books”, and Article 3 of Measures for Verification Collection of Enterprise Income Tax (for Trial Implementation) (Guo Shui Fa [2008] 30) “If a taxpayer is under one of the following circumstances, tax authorities shall have the power to verify the enterprise income tax:(4) where account 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”, the respondent should use the method of “verification collection” instead of using “audit collection” mistakenly.

Verification collection shall be applicable to such situation. This is not only prescribed in the Measures for Verification Collection of Enterprise Income Tax (Tentative) (Guo Shui Fa [2008] No. 30), similar regulations are also implemented in other taxation department in their tax collection practices. For example, Article 4 of the Circulation of Beijing Local Taxation Bureau on Printing and Distributing the Provisional Measures of Beijing Local Taxation Bureau on Verification Collection of Enterprise Income Tax (Jing Di Shui Qi [2004] No. 569) prescribes that “If a taxpayer for the enterprise income tax within the collection range of the local taxation bureau of the city is under one of the following circumstances, the verification collection shall be used to collect enterprise income tax: (4) where account books are established, but the accounts are not in order or information on costs, receipt vouchers and expense vouchers is incomplete, making it difficult to check the books”. Although this document has been repealed, its specific requirements and situations for “Verification Collection” are interconnected with the above Measures for Verification Collection of Enterprise Income Tax (Tentative) (Guo Shui Fa [2008] No. 30). For another instance, Article 5 of the Interim Measures of Guangzhou Local Taxation Bureau on Verification Collection of Enterprise Income Tax (Shui Di Shui Fa [2005] 297) clearly states that, “If a taxpayer is under one of the following circumstances, tax authorities shall have the power to assess the amount of tax payable:(3) where account books are established, but the accounts are not in order or information on costs, receipt vouchers and expense vouchers is incomplete, making it difficult to check the books, including: 1. Where total income can be only checked accurately or verified, but its expenses and expenditures cannot be checked accurately; 3. Total income, costs and expenses cannot be checked properly, and true, accurate and complete tax information cannot be submitted to the tax authorities in charge, causing it difficult to be verified’. Hence, where the total income can be ascertained but costs, expenses and expenditures cannot be accurately checked and ascertained, and total income, costs, expenses and expenditures cannot be accurately checked and ascertained, the “verification collection” method should be applied, and only such method may be applied. The “audit collection” shall not apply and is in fact invalid for the case.

3. The respondent fails to verify the objective costs, expenses, losses and other reasonable expenditures of the applicant through the “audit collection” method

In this case, the respondent has determined that “there are 15823724.36 yuan in design fees and engineering income that were not recorded in the account books” “between November 29, 2000 and December 31, 2010”, and used it as the basis for calculation of repayment of business tax, urban maintenance and construction tax, education surtax, and enterprise income tax. Regardless of whether the applicant’s total income as determined by the respondent as relevant to the corresponding items is accurate or not, or whether they exist or not, it is obvious that the respondent has not checked the costs and expenses of the items used to identify income.

According to Part (5), Article 1 “Legal Facts” of the Settlement Decision, the respondent has determined that the applicant has,in 2002, “enterprise income tax payable of 318590.85 yuan, and paid enterprise income tax of 4008.77 yuan” ; in 2003, “enterprise income tax payable of 33115.57 yuan, and paid enterprise income tax of 1128.38 yuan”; in 2006, “enterprise income tax payable of 1191377.86 yuan, and paid enterprise income tax of 2301.18 yuan” ; in 2007, “enterprise income tax payable of 1954777.47 yuan, and paid enterprise income tax of 14571.54 yuan” ; in 2008, “enterprise income tax payable of 1071895.35 yuan, and paid enterprise income tax of 9600.42 yuan” ; in 2009, “enterprise income tax payable of 172493.33 yuan, and paid enterprise income tax of 8754.66 yuan”. <0}AccoAccording to this calculation, the total amount of enterprise income tax underpaid by the application as determined by the respondent is 15,437,018.88 yuan, which has a discrepancy of only 386,705.48 yuan from 15823724.36 yuan, the applicant’s unrecorded income as determined by the respondent. Following this logic, the applicant’s projected income as determined by the respondent is 15823724.36 yuan, while its incurred costs, expenses and expenditures is only 386,705.48 yuan. In other words, the applicant’s gross profit from relevant projects is as high as 97%, which is ridiculous and peremptory.

The above data has sufficiently explained that the respondent has not ascertained the reasonable expenditures such as costs and expenses corresponding to the so-called projected income of 15823724.36 yuan. It has used the above-mentioned Jing Di Shui Qi [2002] No. 526 Document as cover, and hastily used 386,705.48 yuan as “identified” by the respondent as deduction.

Since the respondent is unable verify corresponding costs and fees, it should strictly follow regulations concerning “verification collection” as explained in relevant laws and normative documents such as the Tax Administration Law and the Measures for Verification Collection of Enterprise Income Tax (Tentative) (Guo Shui Fa [2008] No. 30), and should not forcibly use the “audit collection” method to attain an established goal.

4. Whether in “verification collection” or “audit collection”, the respondent should verify the applicant’s expenditures reasonably

When tax authorities perform an audit, apart from actively ascertaining facts that a taxpayer may be concealing its income, they are also responsible for identifying the facts of the taxpayer such as costs, expenses, taxes, losses and other expenditures related to production and management.

For example, Paragraph (3), Article 1 of the Reply of Inner Mongolia Autonomous Region Local Taxation Bureau on Several Business Issues about Income Tax (Nei Di Shui [2006] No. 180) states, “The problems about failure of the enterprise to account for raw materials and bookkeeping in IOUs due to inability to get invoices. In the Signature Procedure for Problems about Pretax Deduction for Failure of Taxpayers to Obtain Invoices after Purchase of Raw Materials”, the Income Tax Management Department of the State Administration of Taxation proposes the following suggestions on treatment: Where invoices are used on an irregular basis, but economic operations did indeed occur, and expenses concerned are also within the range of allowable deduction, the tax authorities may demand the taxpayer to provide formal invoices or other proper evidence that can sufficiently prove authenticity of the expenses and to calculate the amount of expenses accurately; even if the taxpayer cannot provide relevant evidences, the tax authorities are responsible for verifying the amount and proportion of relevant expenses through other reasonable methods”. Therefore, according to the regulations of the State Administration of Taxation as entailed by the Inner Mongolia Autonomous Region Local Taxation Bureau, the tax authorities have the responsibility to ascertain the specific amounts of costs, expenses, losses and other expenditures that are related to the taxpayer’s production and management. Even if the taxpayer does not provide normative invoices for relevant costs and expenses, but can provide “proper evidence that is able to prove the authenticity of expenses and to calculate the amount of expenses accurately”, such as business contracts, payment vouchers, payment receipts, and witness testimonies from the payee, the tax authorities shall recognize such costs and expenses. If the taxpayer fails to provide relevant evidence, the tax authorities still have responsibilities to “verify” relevant costs and expenses in a reasonable manner and shall not regard them as unincurred costs following the “audit collection” method, or “confirm” the costs on their own.

IV. “Decoration” income is not taxable for the applicant

The respondent ascribes “decoration income” to the applicant. Regardless of its main body, only in terms of the nature of the income, it shall not be deemed taxable even if it is ascribed to the applicant.

1. As the applicant does not have the construction enterprise qualification certificate for “a decoration and renovation enterprise for accepting internal decoration or residential renovation projects”, it is impossible to obtain “decoration income”.

According to Article 22 of the Measures for Management of Internal Decoration (Ministry of Construction, Order No. 110), “A decoration and renovation enterprise undertaking internal decoration projects must be subjected to a qualification review by the competent department of construction administration, obtain a corresponding construction enterprise qualification certificate, and undertake projects within the allowable range of its qualification level”. The applicant does not belong to the range of construction enterprises as described above, and has no corresponding qualification, i.e. it has no right and ability to gain any “decoration income”.

2. If the respondent insists on ascribing the income to the applicant, then the income can only be categorized as “illegal income”.

On the “taxability” of illegal income, regardless of the academic debate involved, one can easily make a judgment in accordance with the “statutory” principle as outlined in the established legal system of China. According to Article 4 of the Tax Administration Law, “Units and individuals that are obligated to pay tax as prescribed by laws or administrative regulations are taxpayers”, and 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 seize the commodities or goods of equivalent value to the amount of tax payable; if he pays the amount of tax payable after the seizure, the tax authorities shall immediately release the seizure and return the seized commodities or goods; if he still fails to pay the amount of tax payable after the seizure, the seized commodities or goods 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 shall be used to offset the amount of tax payable”. The Tax Administration has only stated tax collection authority over “illegal income” that is a result of unlicensed operations. Beyond this situation, there is no further regulation or law for tax collection, and it cannot be expanded freely. Obviously, action that is “beyond operation range” is not equivalent to an action of “not handling tax registration according to regulations” as stated in Article 37 of the Tax Administration Law.

3. The tax authorities’ treatment of such actions has surpassed their own functional range and violates the administrative powers of other functional departments

According to Article 6 of the Construction Law of the People’s Republic of China, “The department in charge of construction administration under the State Council shall exercise unified supervision and regulation over construction activities of the whole country”, and Paragraph 3 of Article 65, “An organization which is hired for projects without a certificate of qualification shall be outlawed and be fined, with all its illegal incomes confiscated”. Even if according to the respondent’s logic that such income is ascribed to the applicant, the income of “an organization which is hired for projects without a certificate of qualification” shall be managed and punished by the administrative departments of construction under the State Council instead of tax authorities.

V. Lack of legal content in the Settlement Decision

According to Article 56 of the Tax Investigation Rules (Guo Shui Fa [2009] No. 157), the Tax Settlement Decision shall include the following major contents: (6) Tax overdue time, calculation method for late fee, payment due date and place”.

However, in the “2(6) Late fee” section, Part 2 “Settlement Decision” of the Tax Settlement Decision, the respondent only clarifies the legal basis (i.e. Article 32 of the Tax Administration Law), but does not define “Tax overdue time” and “method for calculation of late fee”, making it difficult for the applicant to comprehend the late fee amounts of “416144.88 yuan”, “25996.82 yuan”, and “2748189.82 yuan”.

In summary, to safeguard the legitimate rights and interests of the applicant, to keep the tax payment relation between tax authorities and enterprises, and to maintain authority, equality and fairness of national tax laws and tax law enforcement, your bureau is kindly asked to review the Notification of Beijing Local Taxation Bureau on Definition of Several Policy Business Issues on Enterprise Income Tax (Jing Di Shui Qi [2006] No. 526) on which the respondent has based its decision, to verify the facts and according to law, withdraw the Administrative Punishment Decision of the Second Investigation Branch of Beijing Local Taxation Bureau (Er Ji Shui Ji Chu [2011] No. 63)

Hereby undersigned, for the

Beijing Local Taxation Bureau

Applicant: Fake Design Culture Development Ltd.

Legal representative: Lu Qing
January 12, 2012
Photo
Shared publiclyView activity