Editor's note: Subject to the operating characteristics of the coal industry, a large number of coal enterprises have the chronic problem of separating bills and goods from the procurement end. In the past, due to the adoption of simple charges in the legislation for the crime of false issuance of special VAT invoices, the judicial authorities mostly believed that the act of false issuance constituted this crime, and the separation of bills and goods in the coal industry was an act of false issuance under the original judicial interpretation, and was also investigated for criminal liability for the crime of false issuance. Recently, the Supreme People's Court and the Supreme People's Procuratorate issued the Interpretation on Several Issues Concerning the Application of Law in Handling Criminal Cases Endangering Tax Collection and Administration (Fa Shi [2024] No. 4), which clearly stipulates the constitutive elements of the crime of false issuance, and also clarifies that the act of false issuance that is not for the purpose of tax fraud and does not cause tax fraud and loss due to tax deduction shall be criminalized. In the case of a case involving a ticket in the coal industry that is directly characterized as a crime of false issuance without examining the subjective purpose of the perpetrator and the objective harmful consequences of the act, the court may actively file an appeal.
1. How to understand the provisions on the criminalization and exculpation of false opening crimes under the new judicial interpretation
(1) The crime of false opening has not been clearly defined as a purpose or result
The nature of the crime of issuing false VAT invoices has been the subject of much controversy. The "perpetrator theory" holds that as long as the perpetrator carries out the objective act of falsely issuing special VAT invoices, the constitutive elements of this crime are satisfied, and the criminal responsibility for the crime of false issuance should be investigated. The "purpose theory" and "result crime theory" hold that the crime of false issuance requires that the perpetrator of the false opening has the purpose of "defrauding the value-added tax", and that the false opening behavior causes the harmful result of "loss of national value-added tax interests". However, for a long time, the views of "purpose theory" and "result theory" have lacked a direct and applicable legal basis, and there are controversies and obstacles whether they can be applied in judicial practice.
In fact, this issue has not been resolved after the promulgation of the new judicial interpretation. From the perspective of the logic of the application of law, the Criminal Law stipulates that "false issuance of special VAT invoices or other invoices used to fraudulently obtain export tax rebates and tax deductions" constitutes the crime of false issuance, whether it is Fa Fa [1996] No. 30 or the new judicial interpretation, they only refine the interpretation of "false issuance of special VAT invoices or other invoices used to fraudulently obtain export tax rebates and tax deductions" as several types of false issuance, without further setting prerequisites for false issuance, and failing to have the purpose of defrauding tax credits. Factors such as the result of tax loss are included in the elements of false issuance. If the crime is committed with a purpose or as a result, the new judicial interpretation should add the expression "for the purpose of defrauding taxes and causing tax losses" before each type of false opening act. According to the current provisions, it can still only be concluded that there are five types of false issuance of special VAT invoices or other invoices used to fraudulently obtain export tax rebates and tax deductions, and thus constitute the crime of false issuance under the Criminal Law. Therefore, from the text of the new judicial interpretation, it cannot be considered that it adjusts false opening to a crime of purpose and a crime.
(2) The pattern of false opening behavior is further expanded
As for the definition of "false issuance of special VAT invoices", the Criminal Law stipulates that "false issuance for others, false issuance for oneself, false issuance for others, and introduction of others to false invoices", which is relatively general. For a long time, the determination of false issuance of special bills in judicial practice is based on the provisions of Article 1 of Fa Fa [1996] No. 30, that is, there are three types of behaviors: false opening of no goods, high opening of goods, and opening on behalf of others. The new judicial interpretation adjusts the criteria for determining the false issuance of special VAT invoices, and clarifies the circumstances of "false issuance" by adopting the "enumeration + fallback" formula. Among them, Article 10, Paragraph 1, Item (1) of the New Judicial Interpretation can correspond to the act of false opening of goods without goods in Fa Fa [1996] No. 30, and item (2) can correspond to the act of opening high with goods, but item (3) has been expanded, specifically:
According to the Provisional Regulations on Value-Added Tax, the tax deduction needs to meet four conditions, one is that the purchaser is a general taxpayer, the second is the procurement of taxable items, the third is the payment of input tax, and the fourth is to obtain invoices from the seller. For businesses that do not meet one of the above four conditions and cannot be deducted in accordance with the law, and invoices are issued through fictitious transaction entities for businesses that cannot be deducted in accordance with the law, it constitutes the false opening of item (3), including:
1. The seller sells taxable items to individuals and small-scale taxpayers (tax cannot be deducted according to law), but issues invoices to other general taxpayers;
2. The purchaser procures non-taxable items (such as accepting labor provided by employees), but obtains a special VAT invoice issued by a third party;
3. The purchaser has not paid the input tax for the procurement of taxable items (such as personal procurement services that have never reached the tax threshold), but obtains a special VAT invoice issued by a third party;
4. The purchaser pays input tax for the purchase of taxable items, but obtains the invoice from a third party without obtaining the invoice issued by the seller.
Among them, the above-mentioned first type of conduct belongs to the separation of tickets and goods at the sales end, which is not stipulated in Fa Fa [1996] No. 30, and is a new matter in the new judicial interpretation. The second to fourth types of behaviors are the acts of purchasing on behalf of the purchaser, which are uniformly stipulated as invoicing on behalf of Fa Fa [1996] No. 30. It should be noted that although these three types of acts are still not distinguished under the new judicial interpretation, they are all treated as false acts, but in the three types of acts, the subjective purpose of the actor and the consequences of the act are different, and it is necessary to further analyze whether they may be guilty in conjunction with paragraph 2 of article 10 of the new judicial interpretation.
In addition, the new judicial interpretation also adds the catch-all clause of "illegal tampering with electronic information related to special tickets" in item (4) and "false issuance by other means in violation of regulations" in item (5), which also exceeds the provisions of Fa Fa [1996] No. 30.
(3) Increase the cause of criminal obstruction
According to the foregoing discussion, it is entirely possible to equate the act of false opening with the crime of false opening in judicial practice, and at the same time, due to the further expansion of the types of false opening behavior, the criminal risk of false opening crime has greatly increased.
According to the second paragraph of Article 10 of the New Judicial Interpretation, "if the purpose is not to defraud tax deductions for the purpose of inflating performance, financing, loans, etc., and there is no loss caused by tax fraud, this crime shall not be punished, and if other crimes are constituted, criminal responsibility shall be pursued for other crimes in accordance with law." "This provision should be read in the following four ways:
1. Legal effect: It is not an element of the crime, but it is an exculpatory clause and has the effect of deterring the crime. It is not an element of the crime, which means that it is not a factor that must be considered in the process of criminalization, and the judicial organs can fully determine the crime of false opening in accordance with the provisions of Article 10, Paragraph 1 of the New Judicial Interpretation, and whether the parties have the purpose of defrauding tax deductions or whether they have caused tax losses do not constitute the scope of reasonable doubt, and the judicial organs do not need to actively collect relevant evidence. In the case of false opening, if the party can prove in accordance with paragraph 2 that it does not have the purpose of defrauding taxes and has not caused losses to be defrauded of taxes, and it is verified and established by the judicial organs, the judicial organs may be prevented from convicting. Although this provision seems to violate the basic principle of the criminal law that the parties cannot be required to prove their innocence, from the perspective of the logic of the new judicial interpretation, the burden of proof of guilt is still on the side of the parties.
2. Understanding that the term is not for the purpose of defrauding tax deductions: "for the purpose of inflating performance, financing, loans, etc., not for the purpose of defrauding tax deductions" means that the terms are not completely enumerated, that is, they are not limited to the three situations of inflated performance, financing, and loans. "Not for the purpose of defrauding taxes" emphasizes "deception", that is, deception. According to the above discussion, the purpose of the three types of invoicing in the procurement process is different, in the case of not purchasing taxable items and not paying the tax-included price, the purchaser itself has no right to deduct, if the invoice is issued on behalf of the deductible tax that should not be deducted, it is a fraudulent deduction, and in the third case, the purchaser actually procures taxable items, The payment of the tax-inclusive price is not deductible according to the law due to the defect of the invoice, rather than being deductible according to the law because it does not have the right to deduct, on the contrary, the purpose is to realize its own right to deduct, not to deduct by fraud. In addition, the act of separating tickets and goods in the sales process cannot be uniformly determined to have the purpose of tax fraud. In the case of invoicing on behalf of the invoice, the key to determining whether there is a right of deduction lies in the invoice recipient rather than the purchaser, and the seller sells to individuals and small-scale taxpayers, without issuing invoices and concealing income, which does have the purpose of infringing on the national tax interests, but this purpose is achieved through the act of concealing income and false declaration, rather than through false invoicing, which is essentially tax evasion rather than false invoicing. As for the seller to issue invoices to the invoicing party, it constitutes a new legal relationship of invoicing on behalf of the invoice, whether there is the purpose of tax fraud in this link, it is necessary to further combine the judgment of whether the invoice recipient has the right to deduct, and the invoicing party has the right to deduct, and the invoice on behalf of the invoice does not have the purpose of tax fraud, and cannot be determined to have the purpose of deception because of the separation of the bill and the goods.
3. There is no understanding of the loss of tax fraud caused by deduction: at present, there are two understandings of this clause, one is that obtaining false invoices and deducting them is equivalent to causing tax losses, and this clause emphasizes that there is no deduction after false invoicing; According to this understanding, it means that there is no necessary causal relationship between the deduction of false invoices and the loss, and the deduction of false invoices may or may not cause tax losses. The author is inclined to the second understanding. False opening and deduction is not equal to loss, if there is a deduction right on behalf of the opening is such a situation, the following will be combined with the analysis of typical ticket-related cases in the coal industry.
4. Level of Validity: This clause can be directly invoked as a legal basis. In fact, this clause is not a completely new clause, and the spirit of this clause has been reflected in documents such as Fa Yan [2015] No. 58 and the Supreme People's Procuratorate's Opinions on Six Stability and Six Guarantees, but Fa Yan [2015] No. 58 has a low level of effectiveness, which can only reflect the understanding of the SPC Research Office, and cannot be directly used as the legal basis for the crime of false issuance of special VAT invoices, and many courts believe that it cannot be directly invoked in judicial trials. The Opinions on Six Stability and Six Guarantees are a separate document issued by the Supreme People's Procuratorate, and there is controversy over how to interpret and apply them in judicial trials. For the first time, the new judicial interpretation clearly stipulates this clause in the form of a judicial interpretation, which means that the judicial authorities can directly invoke this clause to exonerate the parties, which is of great progressive significance.
2. Observation of typical ticket-related cases in the coal industry in recent years
(A) over-mined coal mine invoicing
In order to promote the optimization and upgrading of the energy industry, the mainland has implemented a quota system for coal mining, and the part that exceeds the mining quota cannot be sold normally. In order to solve the problem of insufficient deduction of input invoices and realize the rights and interests of VAT input deduction, some coal enterprises will take the form of paying invoicing fees to third-party counterparts to adjust the "surplus invoices" to solve the problem of excessive tax burden. Although the quantity and amount of goods contained in the invoices issued by a third party are consistent with the actual transaction situation, the tax authorities believe that the issuer and the seller of the goods are inconsistent, and still tend to transfer the invoice to the public security for criminal proceedings.
The VAT chain is interlocking, and whether the upstream enterprises issue special VAT invoices legally and compliantly, and whether they pay the VAT tax on time and in full, directly affects whether the downstream enterprises can declare and deduct the VAT input tax normally and whether the deduction behavior will cause national VAT losses. In the case of false invoicing in the coal industry, a considerable number of cases are due to the problem of false invoicing in upstream enterprises and then implicate downstream enterprises, and the downstream invoice-receiving enterprises are subject to tax inspections and transfer out of inputs, which affects the continuous operation of enterprises;
(2) Invoicing for small coal kilns
On the one hand, due to the restrictions on coal mining quotas, coal mining enterprises cannot sell coal mined in excess of the quota in their own name and provide special VAT invoices, so some small coal mines cannot directly supply coal to coal-using enterprises. On the other hand, although the administrative licensing system for coal business was abolished in 2014, individuals holding small coal mines can also engage in coal distribution activities, but for small coal mine owners, engaging in coal distribution activities in their own name faces the legal obligation to issue special VAT invoices to coal-using enterprises, and need to pay VAT, individual income tax and other taxes in accordance with the law. Therefore, due to the cumbersome procedures for applying to the tax authorities for invoicing on behalf of the tax authorities and the economic factors of taxes and fees, small-scale coal mine owners are usually reluctant to directly supply coal to coal-using enterprises in their own names. In order to alleviate the above problems, in reality, there are many small coal mines that seek formal large-scale coal mines to carry out coal sales business through the mode of affiliated operation.
However, in practice, this kind of affiliated business model is prone to the situation of "separation of bills and goods", and there are easy situations such as capital advances and loans in the receipt and payment of funds, and it is easy to be recognized by the tax authorities and public security organs as the return of funds that do not have real goods transactions. In addition, due to the weak legal awareness of the affiliated party and the affiliated party, they neglected to sign a written affiliation contract after reaching an oral affiliation agreement, which led to the relevant authorities doubting the authenticity of the affiliation, and then denying the establishment of the affiliation model and determining that the enterprise had made false openings.
3. Characterization of ticket-related cases in the coal industry under the judicial interpretations of the Supreme People's Court and the Supreme People's Court
It can be seen from the provisions of the new judicial interpretation that the core point of whether the perpetrator can prove that he subjectively did not have the intention to defraud the tax deduction and objectively did not cause the loss of state tax due to the deduction is the core point of whether the perpetrator can be convicted. In the case of substitution of the right of deduction, the parties may argue that they meet the conditions for exculpation from the following perspectives, specifically:
1. Seller: The seller fails to issue invoices or declare the sales of taxable items, which is an act of tax evasion of hidden income, not a false invoicing, and it does not participate in the invoicing behavior of the purchaser, which does not constitute the crime of false invoicing. For their tax evasion, they can be investigated for administrative responsibility for tax evasion.
2. Purchaser: The purchaser purchases taxable items and obtains the right to deduct, because the seller does not issue invoices and opens them from a third party, in order to realize the right to deduct taxes, and there is no intention to defraud the tax. At the same time, the purchaser has the right to deduct if there is a real purchase, and the tax deducted on behalf of the purchaser is the input tax that the purchaser has paid in the actual procurement, and the deduction has not caused a tax loss. It should be emphasized that the seller and the purchaser are independent legal entities and should bear the responsibility for their respective acts, and the tax liability and deduction rights of both parties should be determined separately, and whether the seller actually declares and pays taxes on the input tax received by the seller does not affect the purchaser's right to deduct. If the seller conceals income and causes tax losses, it has nothing to do with the purchaser's deduction, and the seller shall be held liable according to the above analysis.
3. Biller: If the biller fulfills the audit obligation and confirms that the drawee has a real procurement behavior, the subjective purpose of the invoice is to help the drawee realize the right to deduct, not to help the drawee defraud the tax deduction, and does not have the purpose of defrauding the tax credit. According to the provisions of the Provisional Regulations on Value-Added Tax, the VAT tax liability depends on whether there is a sale, and there is no tax liability if there is no sale, and even if the invoice is false, there is no tax liability. If the invoicing party has no sales behavior, false invoicing will only confirm the output and overpay the tax, but it is impossible to underpay the tax, and will not cause tax losses. In practice, if the upstream enterprise fails to deduct the output tax generated by its false invoicing by means of false invoicing, the deduction will not cause tax losses because the output tax itself does not correspond to any statutory tax liability.
Therefore, when defending a coal ticket-related case, it is necessary to analyze the actor's transaction model, focusing on refining and emphasizing whether the transaction model will cause the loss of the national value-added tax, as well as the motives and reasons for the actor to choose this transaction model, to see whether he subjectively has the intention to defraud the state value-added tax, and if the above conditions are not met, he can actively adduce evidence to achieve the guilt. In addition, how to accurately grasp the distinction between various crimes and accurately apply the relevant provisions will still be a difficult point in future practice. In other tax-related crimes, there may also be acts of false issuance of special invoices, such as the crime of tax evasion, the crime of illegally selling special VAT invoices, the crime of illegally purchasing special VAT invoices, the crime of purchasing forged special VAT invoices, etc., although the perpetrator may not constitute the crime of false issuance of special VAT invoices, it may still constitute other crimes.
Basic facts of the case
There are two coal trading enterprises in a certain place, namely Company A and Company B. Company A mainly buys commercial coal from coal chemical companies and sells it directly to local residents or small factories that use coal. Because these consumers did not request invoices, Company A had a large surplus of inputs, and at the same time, Company A sold commercial coal without invoices, and failed to declare the uninvoiced income in accordance with the law. Company B mainly purchases raw coal from small coal kilns and sells it to coal chemical enterprises. Due to the over-exploitation of small coal kilns, invoices could not be issued in accordance with the law, and Company B had the problem of insufficient input for a long time. When Company B sells to a downstream coal chemical enterprise, the downstream enterprise requires an invoice, but if Company B invokes the full amount of the invoice, it will bear excessive VAT liability. Company B was introduced by an intermediary and contacted Company A, and Company B obtained input invoices from Company A by paying a certain invoicing fee to Company A. In the invoicing process, Company B provided the pound bills and settlement statements made by purchasing raw coal to Company A, and Company A issued invoices according to the quantity and amount recorded in the documents.
After big data analysis, the local tax authorities found that the two companies had tax-related risks and decided to file a case for inspection. The tax authorities believe that Company A sells goods to consumers, Company B purchases goods from a small coal kiln, and there is no relationship between Company A and Company B for the purchase and sale of goods, but Company A issues invoices to Company B, which is "issuing special VAT invoices for others and others for themselves without purchasing or selling goods", which constitutes false issuance of special VAT invoices, and should be investigated for legal responsibility for false issuance and transferred to the judicial authorities for processing.
Court decision
Company B's act of purchasing raw coal from a small coal kiln and choosing to obtain an invoice from Company A without obtaining a VAT invoice in accordance with the law subjectively has the intention and purpose of undermining the order of the state's invoice management, objectively violating the state's prohibitive provisions on special VAT invoices, and carrying out the act of purchasing special VAT invoices from entities that have no right to sell special VAT invoices by paying invoicing fees, etc., undermining the state's order in the management of special VAT invoices, and its conduct meets the constitutive elements of the crime of illegally purchasing special VAT invoices, and is finally convicted of the crime of illegally purchasing special VAT invoices。
4. Cases in which the coal industry has been convicted of false openings can be actively appealed
(1) The provisions of the new judicial interpretation shall still apply to the retrial review of criminal appeals
Judicial interpretations differ from laws and regulations in that they are not only an independent form of law, but also relevant or dependent on relevant laws and regulations. In the author's opinion, according to the principle of legality of crimes, if adjustments are made to the basic issues of conviction, such as the constitutive elements of a crime and the reasons for preventing a crime, it must be achieved through the revision of the Criminal Law. Judicial interpretations cannot replace legislation and amendment of laws, and the provisions on criminalization and exculpation in judicial interpretations are themselves made for the purpose of better understanding and applying applicable legal provisions, and are an interpretation of the meaning of the legal provisions. In other words, the exculpation and criminalization clauses of the criminal justice interpretation are the proper meaning of the criminal law, and they do not overturn the old legislation or create new legal rules.
To sum up, if the parties have not fully exercised the right to present evidence on issues such as not having the purpose of tax fraud and not causing tax losses, they can still file a complaint in accordance with the new judicial interpretation, and at the retrial review stage, the court should also apply the incrimination and exculpation provisions of the new judicial interpretation to comprehensively assess whether the party has constituted the crime of false opening.
(2) The appeal strategy of the coal industry that has been convicted of false opening cases
If a party has a criminal obstruction cause of "inflating performance, financing, loans, etc., not for the purpose of defrauding taxes, and not causing tax deception losses due to deductions", they must take the initiative to raise and present evidence, and only after verification can the effect of deterring the crime be realized. Enterprises should pay attention to the retention of the original enterprise for future reference, so as to form a complete evidence chain to prove the authenticity of the transaction and avoid the risk of no real transaction. There are tax-related risks in all aspects of the coal industry, so no matter in the mining, purchase and sales, transportation, and processing links, we should pay attention to complete business processes and pay attention to business approval. In specific business, enterprises should improve the retention and review system of written contracts. In addition, when purchasing coal or receiving transportation services, special attention should be paid to whether the seller is affiliated, and whether there is any third-rate inconsistency in a timely manner. In terms of the design of contract terms, the tax-related clauses such as the type, item, tax rate, invoicing time, tax subject, off-price expenses, and liability for breach of contract should be clearly agreed upon. After the transaction is completed, it is necessary to keep the relevant contracts, invoices, transportation documents, remittance notes and other information and evidence related to the transaction. When collecting evidence, the real transaction chain should be restored as comprehensively as possible to verify the authenticity of the transaction.
(3) The specific procedures for appeals in criminal cases in accordance with law
The criminal complaint procedure is a trial supervision procedure throughout the proceedings to review and correct a judgment or ruling that has already been rendered. Parties, their legally-designated representatives, or close relatives may file an appeal against a judgment or ruling that has already taken legal effect, to the original trial court or the procuratorate at the same level. Appeals in major or complicated criminal cases may also be submitted to the people's court at the level above that made the second-instance criminal judgment or ruling. The time limit for appealing is generally two years after the completion of the sentence. After receiving the complaint, the court or the procuratorate shall conduct a comprehensive review, which shall include the facts of the case and the applicable law. If the original people's court of final appeal, after examining the criminal appeal, finds that the original judgment or ruling is correct, it shall persuade and educate the complainant to accept the judgment and dismiss the appeal; If, after review, it is discovered that the original judgment was truly in error and needs to be retried, a collegial panel should be formed separately to conduct a retrial in accordance with the trial supervision procedures.