Interim Measures for Awarding Reports Against Illegal Acts of Taxpayers with Regards to Taxation

Interim Measures for Awarding Reports Against Illegal Acts of Taxpayers with Regards to Taxation

Order of the State Administration of Taxation and the Ministry of Finance [2007] No. 18

January 13, 2007

The Interim Measures for Awarding Reports Against Illegal Acts of Taxpayers with Regards to Taxation have been deliberated and adopted by the State Administration of Taxation and the Ministry of Finance. They are hereby promulgated and shall go into effect as of March 1, 2007.
Director General of Taxation: Xie Xuren
Minister of Finance: Jin Renqing

Tentative Interim Measures for Awarding Reports Against Illegal Acts of Taxpayers with Regards to Taxation
　
Article 1 With the goal of encouraging tip-offs against tax-related illegal acts, these Measures are formulated according to the related provisions in the Law of the People's Republic of China on the Administration of Tax Levying and the Detailed Rules for the Implementation thereof.
　
Article 2 The term "tax-related illegal acts" as mentioned in these Measures refers to the tax-related illegal acts committed by taxpayers or withholding agents and other tax-related illegal acts as specified in these Measures. A tip-off against tax-related illegal acts shall be an act of an entity or individual who does so at its/his free will.
　
Article 3 In case an entity or individual tips off a tax-related illegal act to the taxation authority in its or his true name and the fact is found to be true upon verification, the taxation authority may, on the basis of its/his contribution, award the entity or individual according to these Measures. An entity or individual may not be awarded under any of the following circumstances:
(1) The informant tips off anonymously or is unable to prove its/his true identity;
(2) The informant is unable to provide any clue on the tax-related illegal act, or acquires the evidence on the tax-related illegal act by means of theft, fraud, or by other means that are prohibited by any law or administrative regulation;
(3) The contents of the tip-off are vague and lack factual basis;
(4) The clue provided by the informant has nothing with the tax-related illegal act as investigated and punished by the taxation authority;
(5) The tax-related illegal act tipped off by the informant has been found by or is under the investigation of the taxation authority;
(6) The entity or individual committing the tax-related illegal act has reported the taxation authority the said act before it is tipped off;
(7) A functionary of a state organ obtains information through taking advantage of his power so as to tip off a tax-related illegal act;
(8) The informant gets information on a tax-related illegal act from a state organ or a functionary thereof to tip off the said act; and
(9) Other circumstances, under which the informants may not be awarded, are prescribed by the State Administration of Taxation.
　
Article 4 The funds, which are used by the state taxation administration to reward tip-offs, shall be truthfully listed as expenditures from the special funds for disposing cases under taxation inspection, which are allotted by the Ministry of Finance to the State Administration of Taxation. The funds, which are used by an local taxation administration to reward tip-offs, shall be truthfully listed as expenditures from the special funds for disposing cases under taxation inspection, which are allotted to the local taxation administration at the same level by the public finance department (bureau) of the related province, autonomous region, municipality directly under the Central Government, or city specifically designated in the state plan.
The allotment of the funds for rewarding tip-offs shall be conducted in accordance with the related provisions on administering state treasury.
　
Article 5 The funds for rewarding tip-offs shall be jointly administered by the inspection office and the accounting department under the competent taxation authority, namely, they shall be used by the inspection office, while be paid and supervised by the accounting department under the competent taxation authority.
The state taxation administrations and the local taxation administrations of all provinces, autonomous regions, municipalities directly under the Central Government, or cities specifically designated in the state plan shall prepare an annual report on the use of the funds for rewarding tip-offs, and shall report it to the State Administration of Taxation by the end of March of the next year.
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