Guide for Taxpayers in Shanghai Ⅴ

(I) Rights of tax payers and tax withholding agents
　A. The right to be apprised of the provisions of state laws and administrative regulations on taxation. Tax payers and tax withholding agents shall have the right to obtain information from tax authorities on provisions of state laws and administrative regulations on taxation and particulars concerning procedures for paying tax.
　B. The right to request confidentiality. Tax payers and tax withholding agents shall have the right to request tax authorities to keep confidential the information on them and the tax authorities shall keep confidential such information in accordance with law.
　C. The right to apply for tax reduction, exemption or refunding. Tax payers shall enjoy the right by law to apply for tax reduction, exemption or refunding.
　D. The right to make representations, pleas and to apply for administrative reviews, to file administrative litigation and to demand compensations from the State. Tax payers and tax withholding agents shall have the right to make representations and pleas on the decisions made by tax authorities, as well as the statutory right to apply for administrative reviews, file administrative litigation and demand compensations from the State.
　E. The right to lodge charges and make accusations. Tax payers and tax withholding agents shall have the right to lodge charges and make accusations against tax authorities and tax officials for violations of laws and disciplines.
　F. The right to be respected. Tax authorities and officials shall be impartial in law enforcement, devoted to their duties, clean and honest in their work, courteous to others and well-mannered in their service. They shall respect and protect the rights of tax payers and tax withholding agents and subject themselves to supervisions in accordance with law.
　G. The right to be guaranteed a basic living standard. Tax preservation and enforcement measures taken by tax authorities shall comply with statutory terms of reference and procedures. Residential housing and articles necessary for the maintenance of the life of the tax payers and their dependants shall not be seized or impounded.
　H. The right to apply for postponement of declaring and paying tax. Tax payers and tax withholding agents who are unable to make declaration or submit tax withholding, collection and payment reports as scheduled may apply for postponed declaration or reporting, subjected to the approval of tax authorities. Tax payers who are unable to pay taxes on schedule due to special difficulties may postpone their payment for a maximum period of three months, subject to the approval of the state or local taxation administrations at the level of provinces, autonomous regions or municipalities.
　I. The right to apply to recover their excess tax payments and receive compensations therefor. Tax authorities shall lose no time in returning to tax payers their excess tax payments as soon as they are identified. If excess tax payments are identified within three years of the date of their settlement, tax payers may claim their return by tax authorities, plus interests accrued at the rate for bank deposits of the same period. Tax authorities shall lose no time in returning the payments as soon as they are verified. Where withdrawal from the state treasury is involved, the return shall be effected in accordance with provisions of laws and administrative regulations on the administration of state treasury.
　J. The right to refuse inspections in accordance with law. When making inspection visits, officials from tax authorities shall produce tax inspection certificates and tax inspection notifications and have the obligation to maintain confidentiality for the inspected. The inspected have the right to refuse inspections if tax inspection certificates and tax inspection notifications are not produced.
　K. The right to refuse to perform the obligations to withhold, collect and pay taxes in accordance with law. Tax authorities should not require units and individuals that are not obligated by laws and administrative regulations to withhold, collect and pay taxes to perform such obligations.
　L. Other rights provided for by State laws and administrative statutes.
 
(II) Obligations of tax payers and tax withholding agents
　A. To perform tax registration formalities in accordance with law. Tax payers engaged in production or business shall apply for tax registration, changes or cancellation of their tax registration in accordance with the provisions of tax laws. They shall use their tax registration certificates in accordance with regulations and may not lend, tamper with, damage, trade in or falsify tax registration certificates.
　B. To open bank accounts in accordance with law. Tax payers engaged in production or business shall open basic deposit accounts and other deposit accounts with banks or other financial institutions on production of their tax registration certificates in accordance with relevant State regulations and report all their account numbers to tax authorities
　C. To establish accounting books in accordance with law. Tax payers and tax withholding agents shall establish accounting books in accordance with relevant laws, administrative statutes and the regulations of the competent financial and tax departments of the State Council and keep records and conduct accounting on the basis of legal and valid vouchers.
　D. To report the accounting system in accordance with law. The financial and accounting systems or financial and accounting procedures, as well as accounting software, of tax payers engaged in production or business shall be reported to tax authorities for filing
　E. To keep financial and accounting data in accordance with law. Tax payers and tax withholding agents engaged in production or business shall keep accounting books, accounting documents, tax-paid vouchers and other materials within the period of time prescribed by competent financial and taxation departments of the State Council. They shall not be falsified, altered, damaged or destroyed without authorization.
　F. To make tax declaration in accordance with law. Tax payers shall make declaration in a truthful manner within the statutory time limit and in line with the contents requirements for declaration by submitting tax returns, financial statements and other data as may be required of tax payers by tax authorities in the light of actual needs. Tax withholding agents shall submit withholding, collection and payment reports and other relevant data required by tax authorities in the light of actual needs in a truthful manner within the statutory time limit and in accordance with the content requirements for reporting. If tax payers and tax withholding agents are unable to make tax declaration or submit relevant data within the specified time limit, reporting may be postponed, subject to the approval of tax authorities.
　G. To pay tax in accordance with law. Tax payers and tax withholding agents shall pay taxes or remit tax within the time limit prescribed by law and administrative statutes or by tax authorities in accordance with the provisions of laws and administrative statutes.
　H. To administer invoices in accordance with law. Tax payers shall print, issue, use and acquire invoices in accordance with the provisions of tax laws and administrative statutes.
　I. To use tax protection devices in accordance with law. Tax payers shall install and use tax protection devices in accordance with regulations and may not damage, destroy or make unauthorized alterations to such devices.
　J. To settle tax payments or provide guarantees in accordance with law. If tax payers in arrears or their legal representatives need to go abroad, they shall settle all the taxes payable with the tax authorities, late payment penalties or provide guarantees before going abroad. Tax payers who have large amount of tax in arrears shall report to tax authorities before disposing of their immovable properties or large amounts of assets.
　K. To submit to tax inspections. Tax payers and tax withholding agents shall subject themselves to tax inspections conducted by tax authorities in accordance with law, report to them truthfully, and provide relevant data and certificates. They may not refuse or cover up facts.
　L. To receive legal relief in accordance with law. In case of any dispute arising between tax payers, tax withholding agents and tax payment guarantors on the one hand and tax authorities on the other in connection with taxation, the taxes and late payment penalties shall first be paid or remitted or appropriate guarantee provided in accordance with the taxation decisions of the tax authorities before applications can be made for administrative reviews in accordance with law. In case of their refusal to accept the decision of the administrative review, the case may be brought before a people’s court in accordance with law.
　M. Other obligations prescribed by State laws and administrative statutes.

(I). The rights of tax authorities:
　A. The rights of tax administration: right of obliging taxpayers to fulfill tax obligations; right of checking the accounts of taxpayers who engage in manufacturing and business operation in accordance with the law; right of examining account books and vouchers and other relevant information of taxpayers.
Right of obliging taxpayers to declare taxes in accordance with the law; right of examining taxpayers’ tax declaration, right of verifying tax payable for taxpayers when taxpayers do not declare tax according to tax laws or related regulations; tax offices have the right to demand tax warranty from taxpayers, in case that the taxpayers could not provide needed tax warranty, tax offices have the right to take tax preservative measures. Compulsory enforcement measures may be authorized if necessary in accordance with law. 
　B. The rights of collecting taxes: right of collecting taxes, gratuitously and compulsorily, from taxpayers according to laws and administrative rules;
　C. The rights of tax inspection: right of inspection and supervision of compliance situation of taxpayers;
　D. The rights of invoice control: responsible for the administration and supervision of the printing, purchasing, issuing, acquiring, preservation and cancellation of invoices.
　E. The rights of tax administrative punishment: right of punishing persons in accordance with law in case of violating tax laws;
　F. The rights of submitting taxation cases to criminal investigation: right of turning over persons who seriously violate tax laws to criminal courts for criminal investigation.

(II). Obligations of Tax authorities:
　A. Obligation of publicizing tax laws and regulations, popularizing taxation knowledge and providing free taxation consulting service to taxpayers;
　B. Obligation of keeping confidential of business information of taxpayers and withholding agents;
　C. Obligation of educating staff, improving their political and professional quality;
　D. Obligation of establishing strict code of conduct;
　E. Obligation of strengthening supervision of internal law enforcement;
　F. Obligation of explicitly state job description;
　G. Obligation of conforming to challenge system;
　H. Obligation of furthering tax collecting activities in accordance with the law;
　I. Obligation of strictly controlling the submission and approval of deferral taxes;
　J. Obligation of refraining from enacting illegal regulations on tax allowance;
　K. Obligation of taking tax preservative measures and compulsory enforcement measures in person;
　L. Obligation of observing the rule that tax offices have no right to seal up or impound life necessities and necessary lodgings of taxpayers and tax withholding agents;
　M. Obligation of undertaking legal administrative claims;
　N. Obligation of announcing debt information of taxpayers on a regular basis;
　O. Obligation of standardizing the scope of tax revenue collection the level of income budget;
　P. Obligation of remitting tax revenue to the treasury with regard to decision or opinions from auditing and finance departments as prescribed by law;
　Q. Obligation of not putting bank deposit inquiry information into uses other than tax purposes;
　R. Obligation of producing tax inspection certificates and inspection notice when conducting tax inspection;
　S. Obligation of submitting tax penalty according to revenue budget level;
　T. Obligation of turning over tax crimes in accordance with law.

The Law of the People's Republic of China on the Administration of Tax Collection
·Detailed Rules for the Implementation of the Law of the People's Republic of China on the Administration of Tax Collection
·Taxation Law of the People’s Republic of China on Individual Income Tax
·Detailed Rules for Implementation of the Individual Income Tax Law of the People's Republic of China
·Income Tax Law of the People’s Republic of China for Enterprises with Foreign Investment and Foreign Enterprises
·Detailed Rules for the Implementation of the Income Tax Law of the People’s Republic of China for Enterprises with Foreign Investment and Foreign Enterprises
·Provisional Regulations of the People’s Republic of China on Value Added Tax
·Detailed Rules for the Implementation of the Provisional Regulations of the People’s Republic of China on Value Added Tax
·Provisional Regulations of the People’s Republic of China on Business Operation Tax
·Detailed Rules for the Implementation of the Provisional Regulations of the People’s Republic of China on Business Operation Tax
·Provisional Regulations of the People’s Republic of China on Consumption Tax
·Detailed Rules for the Implementation of Provisional Regulations of the People’s Republic of China on Consumption Tax
·Regulations on Tax Rebate/Exemption of Import and Export Goods
·Provisional Regulations of the People’s Republic of China on Corporate Income Tax
·Detailed Rules for the Implementation of the Provisional Regulations of the People’s Republic of China on Corporate Income Tax
·Provisional Regulations of the People’s Republic of China on Urban and Township Land Use Tax
·Provisional Regulations of the People’s Republic of China on City Maintenance and Construction Tax
·Provisional Regulations of the People’s Republic of China on Land Appreciation Tax
·Detailed Rules for the Implementation of the Provisional Regulations of the People’s Republic of China on Land Appreciation Tax
·Provisional Regulations of the People’s Republic of China on Real Estate Tax
·Provisional Regulations of the People’s Republic of China on Vehicles and Vessels Usage Tax
·Provisional Regulations of the People’s Republic of China on Vehicles Purchasing Tax
·Provisional Regulations of the People’s Republic of China on Stamp Tax
·Detailed Rules for the Implementation of the Provisional Regulations of the People’s Republic of China on Stamp Tax
·Regulations of the State Council on Levying Agricultural Tax on Agricultural Specialties
·Provisional Regulations of the People’s Republic of China on Slaughter Tax
·Detailed Rules for the Implementation of the Provisional Regulations of the People’s Republic of China on Deed Tax
·Regulations of the People’s Republic of China on Agricultural Tax
·Provisional Regulations of the People’s Republic of China on Deed Tax
·State Administration of Taxation: Procedures for Tax Inspection 
·Regulations of the People’s Republic of China on Invoice Management 
·Detailed Rules for the Implementation of the Regulation of the People’s Republic of China on Invoice Management

(I). Jurisdiction of Inspection Authorities
　A. Examine accounting books, vouchers, statements and relevant materials of taxpayers; examine accounting books for taxes to be withheld as well as collected and remitted, vouchers for keeping accounts and relevant materials;
　B. Examine the taxable commodities, goods and other possessions of taxpayers on their production sites, business locations and warehouses; examine the operation of tax withholding agents concerning tax withholding, tax collection and remittance;
　C. Demand taxpayers and tax withholding agents to provide documents, certificates and other materials related to taxation or tax withholding, and tax collection and payment;
　D. Ask taxpayers and tax withholding agents to answer questions concerning tax payment or tax withholding, collection and remitting;
　E. Examine, at the railway stations, docks, airports, postal businesses and their branches, the relevant documents, vouchers and other materials related to the taxable commodities, goods and other items posted or shipped through consignment by taxpayers;
　F. With the approval of the director of the administration of taxation (or branch) at the county level and higher, inspection authorities may, supported by the national standard permit for checking deposit accounts, examine the deposit accounts of taxpayers and tax withholding agents specialized in production and business with their banks or other financial institutions. When inspecting illegal tax cases, tax authorities may, upon the approval of the director of administration of taxation on city (with districts), autonomous prefecture or higher, inspect the deposits of the suspects. Information acquired by the tax authorities in the process of inspection should not be used for purposes other than taxation.
 
(II). Tax Inspection Procedure
　A. Before the inspection, tax inspectors should advise taxpayers with Notice on Tax Inspection, and should produce the certificate for tax inspection and the notice for tax inspection in the process of inspection. Taxpayers, tax withholding agents and others involved have the right to reject the inspection if the tax inspectors fail or refuse to produce the said permit and notice. An in-advance notice can be exempted in any of the following cases:
　　1. When fraudulent activities are reported;
　　2. When suspicion by the tax authorities over the taxpayer’s fraudulent activities is justified;
　　3. When in-advance notice hinders the inspection.
　B. Taxpayers and tax withholding agents must accept the tax inspection conducted by a tax authority in accordance with relevant laws and give a truthful report on facts and provide relevant information;
　C. Collecting relevant evidence. Inspectors must examine every case for evidence when taxpayers are found to have violated laws and regulations on taxation and finance. Inspection authorities should make Written Record of Inquiry and Inspection and Working Paper of Tax Inspection in processing the public tip-offs or fraudulent activities so as to faithfully reflect the facts.
　D. Removal of Accounting Records: If removing accounting books, vouchers and other related materials is found necessary in the process of an inspection, the tax authority must advise the inspected with the Notice of Removing Accounting Books for Inspection and keep a complete record of the removed materials on the List of Accounting Books Removed for Taxation Inspection, with seals and signatures of the respondent and the handling person affixed and the date of removal signed. All the removed materials should be returned within three months.
　E. Verification after Inspection: The tax inspector should verify all the facts with regard to their violation of laws and regulations with the person-in-charge and the accountant of the respondent before presenting the Written Record of Inquiry and Inspection to the said person-in-charge and the accountant for signature or seal of approval. With these completed, the seal of the respondent shall then be affixed onto the Working paper of Taxation Inspection.
If a taxpayers or a tax withholding agent is found to have committed an offence, the tax authority should issue Decision on Settlement of Tax Offences and Decision on Penalties of Tax Offences, as well as a corresponding Notice for Penalty Payment to be signed by the legal representative or related person of the respondent. The tax authority shall monitor the implementation of the above decisions.

(I). Punishments for Violations in Taxation Collection and Management
　A. The tax authority should oblige taxpayers with the following behaviors to rectify. A fine of below 2,000 RMB may be imposed, or an amount of over 2,000 RMB but below 10,000 RMB if the case is serious:
　　1. Failing to register, change or deregister taxes within the specified time limit;
　　2. Failing to set up and keep accounting books, vouchers or related documents;
　　3. Failing to report financial and accounting systems, accounting methods and accounting software to tax authorities for filing;
　　4. Failing to conform to the regulation that all the bank accounts should be reported to tax authorities;
　　5. Failing to install and use tax–controlling devices as required or damage or modify such devices;
Taxpayers who fail to register should be notified to rectify within the time limit by the tax authority; those who fail to meet the deadline shall have their business license revoked by industrial and business administration authorities upon the request of relevant tax authorities;
Taxpayers who fail to use tax registration certificates in accordance with relevant regulations or who rent, obliterate, damage, purchase, sell or forge tax registration certificates shall be imposed a fine between 2,000 RMB and 10,000 RMB; those whose case is serious shall be imposed a fine between 10,000 RMB and 50,000 RMB;
　B. Withholding agents that do not set up and keep accounting books or vouchers should be notified to rectify within the time limit by the tax authority. A fine of below 2,000 RMB may be imposed, or an amount of over 2,000 RMB but below 5,000 RMB if the case is serious.
　C. Taxpayers who fail to declare tax and submit tax-related materials or tax withholding agents who fail to submit tax withholding reports and relevant materials shall be notified to rectify within the time limit by the tax authority. A fine of below 2,000 RMB may be imposed, or an amount of over 2,000 RMB but below 10,000 RMB if the case is serious.
　D. Taxpayers who forge, change, conceal or destroy accounting books or vouchers, or list more expenditure and less or no income, or refuse to declare tax or make false tax declaration, or pay no or less than required amount of tax shall be convicted as tax evasion. Taxpayers who evade taxes shall have their evaded or underpaid tax and late payment penalty recovered by tax authorities and be fined an amount over 50% but below five times of the evaded taxes; those who violate the criminal law shall take further criminal responsibilities.
Tax withholding agents who pay no or insufficient taxes through the above means shall have their evaded taxes and late payment penalties recovered by tax authorities and be fined an amount over 50% but below five times of the evaded taxes; those who violate the criminal law shall take further criminal responsibilities.
　E. Tax payers or withholding agents who forge false basis for calculation shall be notified to rectify within the time limit and fined an amount below 50,000 RMB.
Tax payers who refuse to declare taxes, or pay no or insufficient taxes shall have their evaded and overdue tax recovered by tax authorities and be fined an amount over 50% but below five times of the evaded taxes
　F. Tax payers who evade taxes by way of transferring or hiding assets and hinder tax authorities in performing their duty shall have their evaded taxes and late payment penalties recovered and be fined an amount above 50% but below five times of the evaded taxes; those who violate the criminal law shall take further criminal responsibilities.
　G. Those who cheat tax authorities of tax rebates through false declaration or other means shall have the cheated tax payable revoked by tax authorities and meanwhile be fined an amount above one time but below five times of the cheated tax payable; those who violate the criminal law shall take further criminal responsibilities.
Those who claim tax rebate using deceptive methods shall be excluded for export tax rebate by tax authorities in the specified period.
　H. “Tax defiance” means refusing to pay taxes through means of violence and threats. Those who practice tax defiance shall take further criminal responsibilities according to the criminal law besides paying back evaded taxes and late payment penalties. Those whose case is light and which does not constitute criminal offence shall have their evaded taxes and late payment penalties recovered by tax authorities and be fined an amount above one time but below five times of the evaded taxes.
　I. Tax payers or withholding agents who pay or remit no or insufficient taxes in the specified period and refuse to rectify their behavior within the time specified by the tax authority will be forced to pay the evaded or underpaid taxes. In addition, they shall be fined an amount 50% but below five times of the amount involved.
　J. Tax withholding agents who fail to deduct or collect taxes shall have their taxes recovered by tax authorities and be fined an amount above 50% but below three times of the amount involved.
　K. Tax payers or withholding agents who hinder the inspection of tax authorities by evading, refusing or other means shall be forced to rectify their behavior and be fined an amount below 10,000 RMB, or an amount above 10,000 RMB but below 50,000 RMB if the case is serious.
　L. Those who violate the article 22 of the Law of the People’s Republic of China on the Administration of Tax Collection by illegally printing invoices shall have their faked invoices destroyed and have their illegal proceeds and equipment confiscated by tax authorities and be fined an amount between 10,000 RMB and 50,000 RMB; those who violate the criminal law shall take further criminal responsibilities.
　M. If tax payers or withholding agents engaged in manufacturing or business operation violate the Law of the People’s Republic of China on the Administration of Tax Collection and refuse to implement the tax authorities’ decisions, tax authorities may confiscate their invoices or stop selling invoices to them.
　N. Tax payers or withholding agents’ banks of deposit or other financial institutions who refuse to allow tax authorities check relevant accounts according to law, or refuse to carry out the decision of freezing relevant bank accounts or recovering the evaded taxes made by tax authorities, or help tax payers or withholding agents transfer their deposits after receiving written notice from tax authorities and which result in tax loss shall be fined an amount between 100,000 RMB and 500,000 RMB. The persons directly responsible and others responsible shall be fined an amount between 1,000 RMB and 10,000 RMB.
Pursuant to the Law of the People’s Republic of China on the Administration of Tax Collection, fines below 2,000 RMB may be decided by taxation offices.

(II). Punishments on Violations against Invoice Control
　A. Violations against invoice control include:
　　1. The production of invoices or special fraud protective appliances not in accordance with relevant regulations;
　　2. The purchase of invoices not in accordance with relevant regulations;
　　3. The issuance of invoices not in accordance with relevant regulations;
　　4. The obtaining of invoices not in accordance with relevant regulations;
　　5. The keeping of invoices not in accordance with relevant regulations;
　　6. Lack of cooperation with tax authorities on inspection in accordance with relevant regulations;
　　7. The carrying, mailing, transporting and keeping of blank invoices not in accordance with relevant regulations.
Penalties: Any one of the above violations shall be rectified within a specified period and illegal proceeds confiscated by tax authorities. A fine of up to 10,000 RMB may be imposed. Those who commit two or more above violations may be punished separately.
　B. Other Violations
　　1. Forging or tampering with invoices, illegal purchasing and selling of invoices, falsifying faked seals for monitoring invoice production, and production of faked fraud protective appliances on invoices;
Penalties: tax authorities may seal up, impound or destroy the invoices thus produced, and confiscate illegal proceeds and equipments used. In addition, a fine below 50,000 RMB but above 10,000 RMB should be imposed; serious violations may be sued at the criminal court.
　　2. Any activity against regulations on invoice control which results in tax evasion, underpayment or cheating by other individuals or organizations
Penalties: the illegal proceeds shall be confiscated, and a fine below one time the amount involved may be imposed.

(III). Punishment for violations against Export Tax Rebate/exemption Regulations
　A. Tax authorities shall oblige taxpayers with exporting business to rectify any of the following fraudulent activities within a specified time limit. In addition, a fine of not more than 5,000 RMB may be posed.
　　1. Failing to apply to export tax rebate registration according to relevant regulations;
　　2. Failing to set up, enter and maintain accounting books and vouchers concerning export tax rebate;
　　3. Failing to subject themselves to the inspection of tax authorities in charge of tax rebate or failing to produce required documentations or vouchers.
　B. If, due to negligence or misconduct on the part of enterprises, the actual rebated tax exceeds the amount rebatable, or where export processing enterprises fail to apply for logout of tax exemption when the legal exemption period is over, tax authorities have the right to order enterprises involved to repay the amount that should not be rebated or exempted. Delay in repayment will result in late payment penalty at the rate of 0.05% per day effective from the expiration day.
　C. In case of enterprises obtaining tax rebate through forging or tampering with documentations, bribery or other deceptive means, in addition to the punishment prescribed in Article 66 of the Law of Tax collection and Management of the People’s Republic of China, tax authorities, with approvals from SAT, may deprive enterprises of tax rebate for at least 6 months if violations of these enterprises are serious. During the 6 months, no tax shall be rebated, whether the enterprises export by themselves, or through commissioned agents.
The Ministry of Foreign Trade and Economic Cooperation may revoke the enterprises’ export licenses if the amount involved is particularly large or the case is especially serious.
　D. For those providing or issuing faked special invoice or other tax documentation for export-oriented enterprises, a fine of less than five times the amount of illegal proceeds involved shall be imposed. Where the amount involved is particularly large and where the case is serious, a heavy penalty should be imposed or transferred to a judicial organ to investigate criminal liability in accordance with law.

(IV). Violations in Stamp Tax Collection
Taxpayers with any behavior listed below will be punished in accordance with the nature of the case:
　A. If a taxable document has no or insufficient fiscal stamps, the tax authority, in addition to ordering the taxpayer to add fiscal stamps, may impose a fine three to five times of the value of fiscal stamps that should be supplemented.
　B. If the fiscal stamps on the taxable document are not logged out or crossed out, the taxation authority can impose a fine one to three times of the value of the fiscal stamps that are not logged out or crossed out.
　C. If pasted fiscal stamps are torn off and re-used, the tax authority can impose a fine of five times of the value of the fiscal stamps that are re-used or a fine between 2,000 RMB and 10,000 RMB.
　D. Those forging fiscal stamps shall be transferred to a judicial organ to investigate criminal liability in accordance with law.

(I). Regulations on the integrity and self-discipline of finance and taxation staff. Taxation staffs are not allowed to:
　Item 1: accept the invitation to banquets of taxpayers; or accept the invitation of taxpayers to ceremonial occasions, overseas visits, tours etc without approval;
　Item 2: accept gifts, cash, securities or payment instruments from taxpayers;
　Item 3: accept re-imbursement of costs that should be paid by themselves in subsidiary units and other relevant enterprises and institutions;
　Item 4: take advantage of their power to purchase commodities at prices lower than normal or to buy goods on credit from taxpayers;
　Item 5: take advantage of their power to borrow money or things from taxpayers or impropriate taxpayers’ belongings gratuitously;
　Item 6: accept kickback, introduction fee, fee-in-return-for-favor, or welfare treatments of taxpaying enterprises;
　Item 7: have big celebrations, or engage in extravagant expense on wedding days or funerals of themselves or their families, or on occasions of job shift, birthday, or moving to new houses, or conduct the above celebrations with the aim to accumulate wealth;
　Item 8: use the public fund to buy, build or decorate private houses;
　Item 9: arrange for taxpayers to recruit their relatives or friends without approval;
　Item 10: solicit favor on behalf of relatives or friends on taxation affairs;
　Item 11: offer cash, securities or payment instruments to leaders by any units or individuals;
　Item 12: accept cash, securities or payment instruments from subordinate organizations, or to use public credit cards for private purposes;
　Item 13: obtain memberships of any club with public funds, or to entertain in commercial karaoke, discos, or nightclubs with public funds;
　Item 14: cooperate with others in establishing enterprises or to obtain dividend through investing in the taxpayer;
　Item 15: accept positions (including honorary positions) in any economic organization. In exceptional cases of approval, taxation staff shall not receive payment of any kind from these organizations.
　Item 16: take part in gambling activities;
　Item 17: engage in drug using and drug dealing;
　Item 18: engage in opposite-sex massage or prostitution or accept sex service;
　Item 19: make recommendation and guarantee for the financing of enterprises;
　Item 20: embezzling, hold back, lend out or divert tax payment (including various kinds of deposits and interest differential.)

(II). Administrative punishment against finance and taxation staff for violation of professional discipline:
　Item 1: Actions violating laws and disciplines specified in this item include:
　　1. grafting tax payment or public fund;
　　2. offering, accepting or demanding briberies;
　　3. diverting tax payment or public fund or public property;
　　4. deceptively obtaining export tax rebate in collusion with taxpayers;
　　5. participating in forging, selling, stealing VAT invoices or issuing bogus VAT invoices for others;
　　6. violating regulations concerning the use and control of tax vouchers, seals and invoices for personal gains;
　　7. causing direct loss of tax revenue, public fund or public property due to negligence of duty;
　　8. colluding with, abetting, aiding taxpayers or withholding agents to evade or resist tax;
　　9. holding back or embezzling state tax revenue;
　　10. deducting or exempting taxes beyond one’s power without authorization;
　　11. willfully lowering or raising tax rate and narrowing or expanding scope of tax collection;
　　12. accepting presents, cash gifts and securities from taxpayers;
　　13. purchasing commodities from taxpayers at a lower price with the abuse of power;
　　14. accepting banquet invitation from taxpayers;
　　15. borrowing money or property from taxpayers or buying their commodities on account;
　　16. reimbursing invoices at the taxpayers’ cost;
　　17. directly engaging in business or taking advantage of their positions to provide aids in the business activities for one’s family members or relatives;
　　18. taking part in luxurious entertainment activities held by taxpayers;
　　19. holding part-time positions and receiving payments at the taxpayers;
　　20. collecting fees in the defiance of relevant regulations;
　　21. decorating or changing one’s residence at the defiance of relevant regulations;
　　22. giving favorable words in taxation affairs of one’s family members, relatives, friends and other people and hence resulting in the loss of the country’s tax revenue;
　　23. accepting discount, introduction fees and fees-in- return-for-favor or enjoy welfare offer from taxpayers;
　　24. have big celebrations, or engage in extravagant expense on wedding days or funerals of themselves or their families, or on occasions of job shift, birthday, or moving to new houses, or conduct the above celebrations with the aim to accumulate wealth;
　　25. going abroad with enterprises and institutions without approval;
　　26. other administrative and disciplinary violations.
　Item 2: Those who take advantage of their positions to embezzle tax revenue or public fund, demand and take bribery or divert tax payment or public fund for personal use shall be imposed administrative punishment in accordance with the Provisional Regulation of Disciplinary Punishment on the Embezzlement and Bribery of Staff in Government Departments
　Item 3: Those who deceptively obtain export tax rebate shall be punished as follows:
　　1. If the amount is below 10,000 RMB, the person concerned shall be punished ranging from recording a serious demerit to being removed from the current position;
　　2. If the amount is above 10,000 RMB, the person concerned shall be punished ranging from being removed from the current position to being dismissed.
　Item 4: Those who engage in forging, selling or stealing special VAT invoices or issuing bogus VAT invoices for others with the consequent tax loss of over 10,000 RMB shall be dismissed with no exception.
　Item 5: Those who pursue personal gains with tax vouchers, seals or invoices shall be regarded as embezzlement and receive due punishment in accordance with 　Item 2 of this regulation;
　Item 6: Those who are seriously irresponsible or negligent in their duty shall be given the following punishment with a view of the consequent loss of tax revenue or public property:
　　1. If the loss of tax and public fund or property is under 10,000 RMB, the person concerned shall be given a punishment up to recording a serious demerit;
　　2. If the loss of tax and public fund or property is between 10,000 and 50,000 RMB, the person concerned shall be punished ranging from recording a serious demerit to being removed from the current position;
　　3. If the loss of tax and public fund or property is above 50,000 RMB, the person concerned shall be punished ranging from being removed from the current position to being dismissed;
　Item 7: Those working in collusion with, abetting, or assisting taxpayers or tax withholding agents to evade taxes should be punished as follows with regard to the amount involved and the nature of the case:
　　1. dismissed if committing a criminal offence;
　　2. if not committing a criminal offence, up to removal from the current position if the case is light, or removal from the current position to outright dismissal if the case is severe;
　Item 8: Those working in collusion with, abetting, or assisting taxpayers or tax withholding agents to resist taxes should be dismissed;
　Item 9: Those who engage in reducing tax liability for private enterprises or other private economic organizations beyond their authority should be punished: up to recording a demerit if the amount involved is below 1000 RMB but the case is severe; from recording a demerit if the amount involved is above 1000 RMB. Those who engage in reducing tax liability for public, collective or joint ventures outside of their authority should be punished: up to recording a demerit if the amount involved is exceeding 50,000 RMB, or below 50,000 RMB but the case is severe; from recording a demerit if the amount involved is above 50,000 RMB and the amount is more than 10% of the total tax due of the year, or if the amount involved is less than the above threshold but the case is severe.
Those who allow late payment for taxpayers without permission should be punished with reference to the above.
　Item 10: Those who decrease (or increase) the tax rate, or reduce (or expand) the collection scope and which result in the loss of the state revenue or the violation of the legal rights of taxpayers shall be punished with reference to Items 9 and 12 of this regulation according to the amount involved and the nature of the case.
　Item 11: Those who hold back or embezzle tax revenue totaling above 50,000 RMB or below 50,000 RMB but the case is severe should be punished up to recording a demerit; those with the amount involved exceeding 50,000 and the amount is over 10% of the tax due of the year, or the amount involved is below the above threshold but the case is severe, should be punished from recording a demerit.
　Item 12: Those who receive gifts during domestic official activities in violation of relevant regulations and keep them for themselves for more than one month will be viewed as graft and should be punished with reference to Item 2 of this regulation.
Those who accept gifts, cash or securities will be viewed as bribery and shall be punished with reference to Item 2 of this regulation.
The accumulated amount shall be calculated if the person accepts gifts for more than twice.
Those who accept gifts during alien-related official activities in violation of relevant regulations shall be punished in accordance with relevant alien-related regulations.
　Item 13: Those who take advantage of their positions to accept invitations of taxpayers to banquets will be punished ranging from warning to recording a demerit with a view of the nature of the case involved.
　Item 14: Those who take advantage of their positions to purchase goods from tax payers with low prices should be punished with reference to the gain and nature of the case, as follows:
　　1. warning to recording a serious demerit if the gain is less than 1000 RMB;
　　2. recording a serious demerit to being removed from the current position if the gain is between 1000 and 5000 RMB;
　　3. being removed from the current position to outright dismissal if the gain is above 5000 RMB.
　Item 15: Those who take advantage of their positions to borrow money or ticking from taxpayers should be punished with reference to the amount involved and the nature of the case, as follows:
　　1. warning to being removed from the current position if the amount involved is below 10,000 RMB;
　　2. dismissal if the amount involved is above 10,000 RMB.
Those who rent items from taxpayers should be punished with reference to the above.
In case of renting items without returning for over 6 months, a heavy penalty should be imposed.
　Item 16: Those who take advantage of their positions to reimburse costs will be viewed as bribery and shall be punished with reference to the Item 2 of this regulation.
　Item 17: Those who directly involve in business activities or take advantage of their positions to assist their relatives in their business activities should be punished up to recording a serious demerit; those with a serious case and with detestable means should be punished ranging from recording a serious demerit to outright dismissal.
　Item 18: Those who take advantage of their positions to participate in luxury entertainment held by taxpayers shall be punished with reference to Item 15 of this regulation based on the nature of the case and the amount involved.
　Item 19: Those who take advantage of their positions to serve paid part-time positions with taxpayers will be viewed as bribery and should be punished with reference to Item 2 of this regulation based on the nature of the case and the amount involved; serving any other paid part-time jobs with taxpayers should be punished with reference to this Item.
　Item 20: Those who take advantage of their positions to collect fees from taxpayers in violation of relevant regulations should be punished ranging from recording a serious demerit to being removed from the current position based on the nature of the case and the amount involved.
　Item 21: Those who take advantage of their positions to decorate their residences with public funds, or with free labor and materials from taxpayers, or those who swap small residences for big ones, or old ones for news ones, or low quality ones for high quality ones and therefore violate the interests of taxpayers should be punished with reference to Item 14 of this regulation.
　Item 22: Those who take advantage of their positions to lobby tax related issues for their families, relatives or others and result in the loss of state revenue should be punished ranging from warning to recording a serious demerit.
　Item 23: Those who take advantage of their positions to accept kickback, information fee, or commission should be punished with reference to Item 2 of this regulation.
　Item 24: Those who devour or accumulate wealth in the event of marriage or funeral of themselves or family members, job transfer, birthday party, or moving into new residences should be punished ranging from warning to recording a serious demerit; those with serious cases should be demoted or dismissed.
　Item 25: Those who take advantage of their positions to be absent from work without permission in the name of business trip or meetings, or those who obtain approval from their superior with deceptive means to join tours organized by taxpayers should be punished ranging from warning to recording a serious demerit with a view of the nature of the case.
　Item 26: For those activities not listed in the above, reference can be made to relevant items of this regulation with a view of the nature and consequence of the case.
　Item 27: For those exhibiting any of the following can be exempt from or imposed light administrative punishment:
　　1. take the initiative to confess;
　　2. shows resipiscence and willingly surrender ill-gotten or other illegal gains;
　　3. disclose others’ offences against law and discipline, which are subsequently proved to be truthful;
　　4. take the initiative to take measures to make up for the loss.
　Item 28: A heavy penalty should be imposed for those with:
　　1. the main responsibility in case of complicity;
　　2. two or more offences concurrently;
　　3. no resipiscence and cooperation or those who collude, destroy evidence, resist investigation and refuse to comply;
　　4. repeated offences.
　Item 29: Those who violate criminal law should be imposed the administrative penalty as follows:
　　1. those with set-term imprisonment (except on probation) should be dismissed;
　　2. those who are legally exempt from criminal penalty in accordance with the law should be demoted or removed from the current position.
　Item 30: The person responsible or the head of the department should be punished up to recording a serious demerit with a view of the nature of the case if the said department or any of its employees are found:
　　1. concealing truth or provide false evidence, or conceal or destroy evidence;
　　2. covering up offences using their authority;
　　3. refusing to provide required documents, information and other testifying materials.
　　4. refusing to provide answers or explanations to questions raised by the inspection authority in the place and time specified.
　　5. refusing to implement decisions of the inspection authority, or refusing to adopt recommendations of the inspection authority without justifiable reasons;
　　6. interfering or resisting inspecting personnel exercising their duties according to the law;
　　7. taking revenge on informants, prosecutor, witness, or inspecting personnel.
　Item 31: The inspecting personnel should be punished up to recording a serious demerit with a view of the nature of the case if they are found:
　　1. covering up or circumventing others with their power;
　　2. seeking expediency with their power;
　　3. derelict in their duties and therefore resulting in loss;
　　4. abusing their power in violation of others’ democratic rights, human rights and property rights;
　　5. leaking out information about the case under investigation.
　Item 32: The words “above” or “below” in this regulation refer to items including the one with the words.
　Item 33: The words “heavy” and “light” (penalty) refer to the guidance on the degree of penalty that should be imposed within the range of options.
　Item 34: The Personnel Division and Inspection Division of the Shanghai Municipal Administration of Finance and Taxation (SMAFT) are responsible for the interpretation of this regulation. In case of discrepancy between this regulation and laws and regulations of the State or any other new regulation issued by superior organizations, the State’s laws and regulations or any new regulations shall apply. In case of discrepancy between this regulation and previous regulations of SMAFT or its subordinate organizations, this regulation shall apply. In case of situations unspecified in this regulation, other relevant administrative and disciplinary provisions shall apply.
　Item 35: This regulation shall come into force from the date of promulgation.
 
(III). Regulations of punishment on finance and taxation staff involving in prostitution and gambling
　Item 1: Those who are involved in visiting a whorehouse, or in prostitution through force, introducing, abetting, seducing, and harboring, or in providing convenience for prostitutes or those visiting a whorehouse should be dismissed, or, in the case of Communist Party members, be expelled at the same time.
　Item 2: Those who, for the purpose of reaping profits, assembles a crow to engage in gambling, or those who take a part in gambling, or those recidivist with a large amount of money involved, or those who gamble during office hour and whose case is serious should be punished ranging from recording a serious demerit to dismissal, or, in the case of Communist Party members, from being placed on probation to being expelled at the same time.
　Item 3: The leader directly responsible should be given party disciplinary or administrative punishment in cases of repeated whorehouse-visit, prostitution or gambling in the internal guesthouse, training center and other institutions due to management failure.
　Item 4: Apart from penalizing participants with the Party or administrative disciplines, the leader responsible should be given party disciplinary or administrative punishment in cases of repeated whorehouse-visit, prostitution or gambling in the subordinate institutions due to the breach of duty and management failure.
　Item 5: A heavy penalty should be imposed in case of the Communist Party member involving in whorehouse-visiting or gambling; a heavy penalty should be imposed on those involving in whorehouse-visiting or gambling overseas.
 
(IV). Regulation on the Party discipline and administrative punishment on violations of anti-drug provisions
　Item 1: The “drug” referred to in this regulation includes opium, heroin, morphia, marijuana, cocaine and other addictive anaesthetic and psycho-therapy drugs which are controlled by relevant regulations stipulated by the State Council.
　Item 2: Those with any of the following criminal offences and who are subsequently condemned should be expelled from the Communist Party and dismissed:
　　1. involving in drug smuggling, selling, trafficking, and production;
　　2. holding drugs illegally;
　　3. covering up drug-traffickers;
　　4. hiding drugs or helping keep drugs;
　　5. covering up or concealing the type or source of drugs;
　　6. illegally transporting or carrying drugs across the national border;
　　7. illegally grow plants for abstracting drugs;
　　8. seducing, coercing, or cheating others into taking drugs; forcing others to take or inject drugs;
　　9. harboring others to take or injecting drugs and sell drugs;
　　10. illegally providing anaesthetic and psycho-therapy drugs.
　Item 3: Those who are found with the acts specified in Item 4 below but which do not constitute an offence should be punished no less than being removed from their posts in the Communist Party and in administration; those with minor offences should be given up to serious warning in the Party or recording a serious demerit in administration.
　Item 4: Those who take or inject drugs should be imposed party disciplinary or administrative punishment:
　　1. those who take or inject opium, heroin, morphia, marijuana, cocaine or other drugs should be expelled from the Communist Party and dismissed.
　　2. those who take or inject state-controlled anaesthetic or psycho-therapy drugs should be given no less than serious warning within the Communist Party or administrative demotion; those who become addict again after giving up should be expelled from the Communist Party and dismissed.
　Item 5: Those with the following may be given a lesser punishment or a mitigated punishment:
　　1. giving themselves up and stop taking drug voluntarily before being found;
　　2. giving clues or exposing other people's crimes that can be verified and who provide meritorious service.
　Item 6: This regulation shall apply to those cardres in enterprises and non-profit organizations who are appointed by the state administr4ative organs, or those who are accredited, or recruited by the superior line departments.
 
VII. Contact information of Shanghai Municipal Tax Administration

Note: The one marked with “#” is the monitoring phone number of Shanghai Municipal Administration of Taxation for tax-related affairs.