The State Administration of Taxation has recently issued the First List of Tax Administration's Penalty Powers (the "List"), listing a total of eight penalty powers under three categories on the basis of nine articles from two tax laws and administrative regulations. Among the eight penalty powers, three fall under the category of account books and vouchers administration, two under the category of tax returns filling and three under the category of tax inspection.
According to the List, taxpayers that fail to set up or keep account books, or keep accounting vouchers or the related materials shall be ordered by the tax authority to make rectifications before a prescribed deadline and can be imposed a penalty of up to CNY2,000; in the case of gross violations, a penalty of from CNY2,000 to CNY10,000 shall be imposed. In addition, those engaged in illegal printing, transfers, scalping, alterations or forging of tax payment vouchers shall be ordered by the tax authority to make rectifications before a prescribed deadline and be imposed a penalty of from CNY2,000 to CNY10,000; in the case of gross violations, a penalty of from CNY10,000 to CNY50,000 shall be imposed; where the act constitutes a crime, the parties concerned shall be prosecuted for criminal liabilities in accordance with the law.