China’s X-men actress Fan Bingbing has recently found herself at the receiving end of tax-evasion allegations. It has triggered fury among netizens and has now prompted an investigation into tax evasion in the film and television industry by the Chinese tax authorities.
Last week, former anchor of China Central Television (CCTV) Cui Yongyuan posted several photos on social media of different contracts signed by a Chinese film star for the same job. In one of the documents, the contract was for 10 million yuan (US$1.6 million) and in the other, Cui said the contract was signed for 50 million yuan. In the post, he did not name Fan directly.
Cui questioned what Fan had done with the 50 million yuan left unaccounted for, and said later that he had a drawer of such contracts that may involve multiple big screen stars.
“The State Administration of Taxation (SAT) has ordered local tax bureaus in Jiangsu to investigate and verify online allegations that certain television and movie actors evaded taxes by signing two contracts,” CCTV reported.
Last Sunday, Fan’s studio denied the accusation, saying it would fully cooperate with the relevant authorities. Whether Fan has evaded tax or has any connection to the highlighted contracts still needs further investigation, but “duplicate contracts” have already become an unspoken rule in the film industry.
A producer told national Chinese-language daily newspaper Guangming Daily in 2011 that almost every film house would prepare such contracts for the actors. One of them is presented to the tax authorities while the other is a private agreement between the investor and actors, the producer said, adding that the value difference between the duplicate contracts may be tenfold.
It is a basic social responsibility for every citizen to pay taxes, and as high-income earners with social attention, celebrities should never escape their obligation of rate payment, said People’s Daily in an article published on June 3. Those celebrities who violate the related laws and avoid taxes should not only be condemned by society, but also punished, the article added.
Tax evasion is never unilateral, and the “duplicate contracts” involve multiple parties including the actors, production companies, and investors, People’s Daily said, adding that every party should be held accountable. Therefore, to probe into this individual case and begin an all-round investigation is the anticipated next step.