Lian Liang v. Maoming Municipal Local Taxation Bureau      

Questions:

1How to understand the tax evasion, the constitution of the "false tax return"?

2Enterprises, tax dispute all belong to the "tax dispute"?

The case:The plaintiff to practice good from June 6, 2001 to March 12, 2003, with the Xinyi government signed the "Qian Pai Zhen Qian Pai middle school student dormitory building project construction contract", "bridge" and "contract improvement of street power station project contract" three project contract, the total amount of three contracts for 10941813 yuan. After the project is completed, the plaintiff has charged 10711813 yuan project. From 2003 to March 19, 2004, the plaintiff has to the tax authorities to pay taxes a total of 85394 yuan (including 21900 yuan of taxes is the signature of the tax returns, tax authorities issued a "certificate" withholding taxes, the taxpayer Certificate in column write: "do good", withholding column write: "a").

   From June 1, 2004 to July 23, 2004, to check the tax situation of three projects undertaken by the defendant to the plaintiff, found not truthfully declare taxes, in June 9, 2004 made "ordered deadline for correction notice" to the owners for the practicing a three jump rock station to practice good, the notice by the workers in the plant Lin sign. In August 13th the same year, the defendant to the plaintiff to practice good "tax administrative penalty notice", in October 20th the same year, and to the plaintiff a practice good "tax administrative penalty hearing notice", 26 of the same month held a hearing. In December 10th the same year "the tax administrative punishment decision book" think, the plaintiff Lian Liang to conduct the inspection in the tax authorities before, pay local taxes 469546.91 yuan, has formed after being notified by the tax authorities to declare and refusing to declare and false tax evasion behavior declared, decided to impose the practice good fine of 1 times the amount of tax evasion. The plaintiff refuses to accept the punishment decision to practice good tax by the construction unit and grounds to bring an administrative lawsuit to the court, during the trial court, the plaintiff to the defendant to provide good training requirements "tax inspection check submissions", "a taxation document receipt" on the identification of handwriting. In May 10, 2005, the Maoming Municipal Public Security Bureau to make the appraisal conclusion, identification of handwriting samples of two instruments on the plaintiff's signature and the writing are not consistent.

   In addition, during the period from 2004 June to July, the plaintiff Lian Liang paid pay less tax 469546.91 yuan. August 6, 2004, the defendant made tax treatment decisions, the plaintiff may file an administrative reconsideration, in December the same year the reconsideration organ to make decision is inadmissible.

   The court held that: according to the State Administration of Taxation "tax audit regulations" seventeenth article: "the following cases, can be punished by higher tax authorities investigate or unity power: (a) significant tax escape taxes tax case;...... (five) the provisions themselves need to investigate and deal with cases of "superior tax organ, the defendant has the right to investigate and deal with jurisdiction in accordance with the provisions of the case. Firstly, according to the provisions of the twenty-fourth administrative punishment law, the administrative organ should be in 7 days before the hearing, notify the party concerned of hearing time, place. The October 20th issue the notice of hearing, in 26 days, in violation of the statutory procedures. Secondly, the defendant will "ordered deadline for correction notice" to others to sign, in violation of the relevant provisions of the tax administration law in service. The defendant provided "tax inspection check submissions", "a taxation document receipt" in practice and good signature, the identification of the non plaintiff my writing, the defendant is illegal. Thirdly, tax evasion is deliberately subjective acts, in this case, the plaintiff and the construction units in the project signed a contract with the settlement process agreed by construction units deliberately withholding taxes, so the plaintiff not subjective tax evasion. The defendant informed the plaintiff filing, but "ordered deadline for correction notice" and not in normal service program to plaintiff sign, should be regarded as the plaintiff has not received notice. The defendant that the plaintiff of false tax returns, with the signature of the declaration, but denied that its content is the information provided by me. View from the evidence, the plaintiff is not intentionally to evade tax, is also no need for false declaration, because of the construction unit agreed by construction units withholding tax. From the declaration of the content, only specified tax declaration is 21900 yuan, and the plaintiff in 2004 March 19 has to pay taxes 85394 yuan. In addition, from the subordinate tax authorities issued withholding certificate, "withholding" column write unit "a" construction in fact, the tax authority has approved the plaintiff should pay taxes by the construction unit in a withholding. The plaintiff in the know the construction unit has not on behalf of their tax situation, the tax inspection period has to pay tax 469546.91 yuan. Therefore, from the view of the defendant to provide evidence that the plaintiff, tax evasion is not clear and the evidence is insufficient, the decision on the administrative penalty decision to revoke the defendant made it.

   Maoming Local Taxation Bureau the verdict of the first trial, the trial court of Appeal said: that the plaintiff does not constitute the tax evasion is incorrect, signed from the plaintiff and the contract letting unit contract and other evidence that the plaintiff for the taxpayer, and the plaintiff was a false declaration, resulting in less tax payment, already constitute the tax evasion. According to the "Regulations of the people's Republic of China tax collection and management law" in article eighty-eighth, lead to tax dispute the reconsideration, the plaintiff did not apply for reconsideration according to law, the court of first instance shall be the treatment decision on identification of effective tax examine the facts. In this case the parties have been suspected of tax evasion, the Maoming Municipal Public Security Bureau has on file for investigation in August 24, 2004, shall suspend the trial, and the court judgement. Secondly, the court of first instance that the penalty hearing in violation of legal procedures. The fact that the appellant has held hearings, no influence by the appellant to exercise their rights, and that some minor defects existing in the enforcement procedure on the appellant the appellee was false declaration of tax evasion fact no association, the first instance court ascertained that the error. Request to withdraw the first instance judgment.

    The plaintiff to practice good claims that: the court finds that the facts are clear. Analysis from the appellant evidence, that the plaintiff to practice good being notified by the tax authority to declare and refusing to declare, false tax, a tax evasion behavior facts are not clear, the main evidence. Review the legitimacy of the court of first instance decision on the defendant only processing, processing of the defendant is not called the decision book review. A trial of legal procedures. By the administrative confirmation is whether the appellant tax evasion, is the premise, the defendant in the trial process of trial did not prove the criminal investigation. Again, this case does not belong to the "issues of Administrative Procedure Law > the Supreme People's court" interpretation "of fifty-first case of stay of proceedings. A trial of the applicable law is correct. The specific administrative act of the defendant, the facts are not clear, the main evidence, the illegal procedure. Please the second instance court dismissed the appeal, upheld the.

   Trial court that according to the second paragraph: "the people's Republic of China on tax collection and management law" eighty-eighth "the party decides, the compulsory enforcement measures or does not accept the tax preservation measures of tax authorities, may apply for administrative reconsideration according to law, also may provide the prosecution" to the people's court according to law, the case does not belong to the administrative reconsideration. If a party refuses to accept the case, the tax administrative penalty may also bring a suit to the people's court. First, the construction of practice good "Qian Pai school student dormitory building", "transformation", "the Bridge Street Station" and other three projects and achieved 10711813 yuan project, in the examination of the tax authorities, the plaintiff Lian Liang a declaration to the tax organ and pay taxes 85394 yuan, after the appellant to recognize the plaintiff to practice good little payment of local taxes of 469546.91 yuan. The defendant to the plaintiff. In practice the tax administrative penalty in the process of "ordered deadline for correction notice" of the tax service of documents, not in accordance with the "PRC tax collection and management law" article 101st paragraph second about "where the recipient is a citizen, should be signed by me, without me, to the adult relatives signed the" provisions of the service. Secondly, the defendant to notify the parties hold a hearing in the hearing before the 7 days, in violation of the "administrative punishment law" provisions of the people's Republic of China forty-second second, in violation of the statutory procedures, according to the law the second paragraph third: "no legal basis or not in compliance with the statutory procedures, the administrative punishment is invalid" and "administrative procedure law of the people's Republic of China" fifty-fourth second third orders: "specific administrative acts in violation of the statutory procedures, the decision to withdraw or partially withdraw" provisions, the decision as follows: rejecting the appeal, upheld the.

Case analysis:

    In this case the tax authority is a profound lesson. This number shows that the current administrative organ widespread "heavy entity, light procedure" law enforcement tendency. The tax authorities in the enforcement process specific errors mainly has the following several points: (1) documents to a program error. The people's Republic of China on tax collection and administration law "101st paragraph second" if the person is a citizen, I should direct sign, without me, into his adult relatives ". Specific to the case in most documents, tax authorities served on the receipt of the record are not signed, the tax authorities did not pay full attention to the procedural meaning. In fact, these errors can be avoided, if required signer identification in direct service, to determine whether I am. To sign on behalf of others, may request the issue a power of attorney or other identity documents to prove the identity of legal. For the service by post, should pay attention to fill out the provisions of the name to send documents and shall timely take delivery receipt. (2) the hearing notification time error. Hearing notice ignore many tax authorities in practice, do not pay attention to the legal notice period, as long as after the hearing was held, it did not violate the administrative relative person's legitimate rights and interests. This view is wrong, the law of hearing notice time is to ensure that the administrative relative person has enough time to reply before the preparation, if the administrative organ to shorten the preparation before the time, will cause the administrative relative person in the hearing process of passive, deprived of its right to defend, the hearing process becomes a mere formality.

   From the verdict, the court of second instance of a view, with different emphasis. The court of second instance mainly around the service of documents and the hearing procedure, on some controversial issues in first instance and not specified. The author thinks that there are the following questions worth further discussion:

   If a plaintiff behavior, constitute the tax evasion?

   In this case the court found the defendant not "ordered deadline for correction notice" to the plaintiff, so do not constitute the tax evasion of the elements of the "declaration by notification and refusing to declare". But the constitution "of the defendant's false tax returns" excuse, the court did not respond. What is a "false tax returns," rules for the implementation of the tax collection law there is no explanation, the local tax authority understanding is also Different people, different views. In practice, many tax authorities often directly cited "provisions of the Supreme People's Court on several issues specific application of law in the trial of criminal cases of tax evasion, tax interpretation" of article second, "false tax returns is refers to the taxpayer or withholding agent submits to the tax authority false tax returns, financial statements, withholding, withheld report form or other tax return data......". I just don't think the tax administrative enforcement of law applicable to judicial interpretation of the controversial [note 1], we analyze the case provided is false tax returns?

   From the analysis of evidence, the defendant provides only a list filing tax returns for 21900 yuan, even though the table for tax declaration and the payable tax amount is not the same, but only the evidence and not the taxpayers provide false tax returns. In addition to the two parties of the contract referred to the specific reasons for judgement has been made clear by the construction party withholding taxes and taxpayers without intentional tax evasion and other factors, the author thinks that the key issue lies in the special person to go out construction tax declaration. Tax and general tax registration of households of different normal declaration, person in the field of contracted projects, the vast majority of cases only for temporary registration; and the tax filing deadline is not fixed, usually in charge of project construction will be to tax authorities in front of billing and tax declaration. Practice for engineering is often by the progress payment, according to the provisions of the tax law, the taxpayer shall make tax declaration in every collection. In other words, the taxpayer is not only a declaration, but to many declaration according to the gathering time. Therefore, even if the taxpayer receipts and the total value of the total amount of tax declaration is not consistent, can not rashly as false declaration; unless it is proved that the taxpayer has declared record current amount collected and the amount declared inconsistent, otherwise only the collection fails to declare the part according to paragraph second of article sixty-four in tax collection and management law "fails to make tax declaration" qualitative treatment. Although the signing of the plaintiff and the construction unit contract agreed to by the construction unit to withhold the tax, but because of the construction unit and can't decide tax withholding obligations, the legal consequences of the plaintiff should also construction units without age and deduct taxes in their own responsibility.

    The tax authorities are worthy of reflection in the case. In addition to the issuance of the tax payment voucher is not required to fill in for taxes and tax rates, the reporting date, the subordinate tax authorities in withholding certificate issued, errors will be construction unit "a" as the withholding agent. Although "some policy issues relating to construction industry business tax notice" (tax [2006]177) confirms the construction unit as the legal status of the withholding agent, but in this case occurs, and construction related tax regulations are not the construction unit as the provisions of the withholding agent, the defendant under the tax authorities in the issue tax withholding payment certificate data audit not strictly, to bring unnecessary passive in the litigation process.

  If the dispute between the two tax rate, in this case belongs to the tax dispute?

   The defendant that the plaintiff without preposition of reconsideration procedure, the court shall not accept the. According to the "PRC tax collection and management law" provisions of article eighty-eighth, "the taxpayers, withholding agents, tax payment guarantor disputes with the tax authorities on payment of tax, the tax authorities must be in accordance with the tax to pay or remit the taxes and the late fees or provision of a corresponding guarantee, then you can apply for administrative reconsideration according to law; if the party refuses to accept the administrative reconsideration decision, may apply to the people's court according to law.The party decides, the compulsory enforcement measures or does not accept the tax preservation measures of tax authorities, may apply for administrative reconsideration according to law, but also to people's court according to law."

  So the dispute between the parties whether tax dispute? In accordance with the "Regulations of the people's Republic of China Law of tax collection and the detailed rules for the implementation of the" 100th "tax disputes, the tax administration law eighty-eighth stipulation, refers to the taxpayers, withholding agents, tax payment guarantor for the tax authorities to determine the main tax, tax object, tax range, tax cuts, tax exemption and tax refund, applicable tax rate, the tax basis, tax link, payment period, the tax payment place and tax collection methods, the specific administrative act has the objection to the dispute". From the specific interpretation of the detailed rules for the implementation of the tax disputes, mainly for tax link, is about whether the collection of tax levy, who, how to levy, when the levy, where levy dispute. The control of tax dispute the definition range, this case does not belong to the kind of arguments, because the focus of dispute cases the plaintiff did not pay the full tax behavior whether to belong to tax evasion, tax declaration in the qualitative problem. The cause of action the plaintiff does not see itself in a dissent statements on taxes. The plaintiff refuses to accept the administrative punishment, the tax authorities tax evasion fact based on qualitative and make, have the right to choose to the people's court.

  [note 1]: about the administrative organ can be criminal judicial interpretation as the basis for administrative law enforcement, there is great controversy in reality. In the "bottom Co. v. Xiamen customs administrative punishment decision disputes" (the people's Republic of China Gazette of the Supreme People's court [2006] stage sixth), the court said, "China is a socialist country under the rule of law, what kind of behavior, give the punishment for illegal behavior, should be provided by relevant laws, regulations, between specific provisions of the laws, regulations do not necessarily have a reference to apply. The Supreme People's Court on the trial of criminal cases of illegal publications "the concrete application of law interpretation of several issues", is the applicable law of the people's Court of criminal cases of illegal publications in the presence of interpretation, only to the people's court for such criminal cases. The State Administration for Industry and commerce "play the market illegal cases about illegal income calculation methods of the notice", also is only limited to the administrative department for Industry and commerce handling cases of violation of law applicable to play the market. These two documents and identification of smuggling illegal income unrelated". Therefore, from the mainstream point of view of judicial practice, the court of administrative organs directly to the judicial interpretation of criminal law as the basis for administrative enforcement is negative attitude.