Media company accused of significant tax evasion

Chinese tax authorities unveiled a case in which a media company managing livestreamers and a financial consultancy was found to have allegedly used false invoices to illegally evade taxes worth more than 32 million yuan ($4.4 million) while claiming a government subsidy of some 30 million yuan.

The State Taxation Administration said on Monday that the Huizhou Gaofushuai Cultural Media Company, an MCN (multi-channel network) firm based in Huizhou, Guangdong province, allegedly used 10 shell companies to issue 1,196 invoices amounting to 226 million yuan. The invoices, in turn, allowed some 700 livestreaming hosts to evade personal income taxes worth over 32 million yuan combined.

According to the administration, the case surfaced when tax officials noticed that no personal income taxes were declared by the Gaofushuai company, while its invoices detailing costs, which were huge, mostly came from only about a dozen companies outside the province — an irregularity deemed by officials.