China Hits Top Influencer With $210 Million Fine Over Taxes

[Mista]

China Hits Top Influencer With $210 Million Fine Over Taxes

China slapped an unprecedented $210 million fine on a top livestreamer for tax evasion, stepping up President Xi Jinping’s crackdown on online influencers who have grown wildly popular in recent years.

www.bloomberg.com

China slapped an unprecedented $210 million fine on a top livestreamer for tax evasion, stepping up President Xi Jinping’s crackdown on online influencers who have grown wildly popular in recent years.

Huang Wei -- also known as Viya -- was ordered to pay 1.34 billion yuan in back taxes, late fees and fines, the State Taxation Administration said Monday in a statement on its website. She avoided taxes totaling 643 million yuan by concealing personal income and making false declarations in 2019 and 2020, the statement added.

Shares in China’s largest livestreaming operators and services plunged in New York, with Bilibili Inc. diving 11.6%, Alibaba Group Holding Ltd. falling 5.8% and Joyy Inc. sliding 4.7%.

Huang issued an apology just after the punishment was announced, saying on her Twitter-like Weibo account that she felt “deeply guilty.” “I totally accept the decision of the tax regulator and will actively collect funds to pay the fines within the deadline,” she wrote.

Viya’s representatives did not immediately respond to a request for comment.

The fine is the biggest yet for online salespeople like Viya, who each night compete to convince shoppers to spend millions of dollars on items such as cosmetics, appliances and clothing. The influencer is one of the biggest stars on Alibaba’s Taobao marketplace, drawing traffic and driving consumption.

Government departments need to better coordinate and boost efforts to regulate the livestreaming industry and crack down on tax evasion, the official Xinhua News Agency said in a report Tuesday.

Using data analysis, the tax bureau in the city of Hangzhou suspected Huang had evaded taxes, and she failed to rectify the situation after repeated reminders, the report said.

The episode signals Beijing is turning its attention to the online streaming commerce arena, which has thrived with little regulation in recent years, as part of Xi’s common prosperity drive to share the wealth. The high-profile case may spook merchants and brands who rely on the format to drive sales, not just at Alibaba but across a number of its rivals’ platforms.

In September, the tax authorities announced tougher rules covering celebrities and livestreamers, and last month two of the salespeople were fined a total of $15 million for income tax evasion. The Taobao and Weibo pages for Zhu Chenhui and Lin Shanshan are both blank now.

Livestreaming is part variety show, part infomercial and part group chat -- a format pioneered in China that has grown more popular since the pandemic started. Livestreaming sales are expected to reach more than 1.2 trillion yuan this year, up from just 19 billion yuan in 2017, according to the research firm iiMedia.

Viya had total sales of more than 31 billion yuan in 2020, the most among her peers, the tech media outlet 36kr.com reported earlier.

Her fine is bigger than the one levied on actress Fan Bingbing in 2018, which marked the start of the government’s campaign to rein in the entertainment industry. Fan and companies she was affiliated with were ordered to pay about 884 million yuan in back taxes and fines.

Fan has largely disappeared from the entertainment scene since her punishment. Such high-profile rebukes from the central government usually spell the end of a celebrity’s career.

“Everyone is equal before the law, there is no ‘superstar’ or ‘rich and powerful,’ no one can despise the law and hope to be lucky,” the official Xinhua News Agency said in a commentary about Fan.

 

[Battlion25]

That is alot.. China is really cracking down on stars

 

[Stranagor]

That is alot.. China is really cracking down on stars

In the US, IRS would probably first shoot then ask questions, given the size of evaded tax. One got to be serious about taxing the rich. China is doing right. It is at the same time further easing tax on lower income. That's progressive.

 

[Skull and Bones]

In the US, IRS would probably first shoot then ask questions, given the size of evaded tax. One got to be serious about taxing the rich. China is doing right. It is at the same time further easing tax on lower income. That's progressive.

Lol, no. IRS are controlled by bunch of idiots, and anyone with above average IQ can work around the loopholes.

 

[Song Hong]

The other hidden dimension about this initiative is -- anti money laundering. Almost 100% of celebrities are involved in money laundering. In the past without having big data, it is very difficult for government to prove the income of celebrities, What CPC is doing is to put supporting documents on table asking rock stars to pay their tax, and also a veiled warning that government knows your money laundering activities.

 

[Stranagor]

Lol, no. IRS are controlled by bunch of idiots, and anyone with above average IQ can work around the loopholes.

I was half joking. But, I heard they are allowed to carry weapons, much as like the police.

The other hidden dimension about this initiative is -- anti money laundering. Almost 100% of celebrities are involved in money laundering. In the past without having big data, it is very difficult for government to prove the income of celebrities, What CPC is doing is to put supporting documents on table asking rock stars to pay their tax, and also a veiled warning that government knows your money laundering activities.

The monied class need to be regulated. Otherwise, country becomes an Oligarchy. We have examples to this.

 

[Song Hong]

Viya is getting backside burn now. As a rule of thumb for money laundering she get to keep 10% of her (ill gotten) income while 90% got to be spend out immediately. Eventually these monies will end up in the bank account of some big boss. The legal income she can keep 100%.

When CPC present her the tax bill it is calculated base on her gross income.

This is just a precursor by CPC to tell the big boss to pay their tax. Else CPC will go directly to the big boss instead of going after Viya. The big bosses are feeling chills on their spine.

From this we can see that CPC is doing what she has promised to the people. To reduce the wealth gap and to promote equality.

 

[MH.Yang]

At the same time, China promulgated new laws. Stores with monthly sales of less than 150k CNY ($24k) are exempt from tax.
Previously, only stores with sales of less than 100k CNY ($16k) could be exempted from tax.

 

[Song Hong]

Many recent CPC initiative is not about what is being reported. It is about taxing the rich.

The government of whole world pretend it is very difficult to tax the rich and they do not know what exactly is rich income, and how the rich do money laundering. Only Xi Jinping is the guy who do the real action.

 

[Skull and Bones]

I was half joking. But, I heard they are allowed to carry weapons, much as like the police.

IRS does not carry weapons, a letter from IRS is enough for people to shit their pants.

 

[Stranagor]

At the same time, China promulgated new laws. Stores with monthly sales of less than 150k CNY ($24k) are exempt from tax.
Previously, only stores with sales of less than 100k CNY ($16k) could be exempted from tax.

Progressive taxation. Very critical.

 

[vi-va]

The stars are standing in line to pay their overdue taxes.
Ordinary Chinese are like this

 

[ChineseTiger1986]

Viya is getting backside burn now. As a rule of thumb for money laundering she get to keep 10% of her (ill gotten) income while 90% got to be spend out immediately. Eventually these monies will end up in the bank account of some big boss. The legal income she can keep 100%.

When CPC present her the tax bill it is calculated base on her gross income.

This is just a precursor by CPC to tell the big boss to pay their tax. Else CPC will go directly to the big boss instead of going after Viya. The big bosses are feeling chills on their spine.

From this we can see that CPC is doing what she has promised to the people. To reduce the wealth gap and to promote equality.

The big boss behind Viya is Lenovo, and the big boss behind Lenovo is Deng Xiaoping's youngest son and his grandson.

President Xi is 100% right to destroy these corrupt families.

 

[Mista]

That is alot.. China is really cracking down on stars

That is because she evaded 600-700mil+ yuan in taxes in the first place, which means she has the earning capacity.

 

[xuxu1457]

That is because she evaded 600-700mil+ yuan in taxes in the first place, which means she has the earning capacity.

She sold 30 billion yuan of goods in a year and evaded 640 million yuan in taxes through her owned ten companies.
According to China's tax law, it is necessary to pay twice as much tax as punishment.