On March 18th, the Supreme People's Court and the Supreme People's Procuratorate jointly issued a judicial interpretation, clearly listing the signing of "yin-yang contracts" as a means of tax evasion for the first time. Regarding analysis, it is pointed out that there have been different understandings of the qualitative behavior of tax evasion through signing "Yin Yang contracts". For the first time, the "Two Highs" have clearly listed signing "Yin Yang contracts" as a means of tax evasion. The behavior of tax evasion through signing "Yin Yang contracts" will not only be punished by tax authorities in the field of administrative law enforcement, but those who meet the standards for filing and prosecution will also be held criminally responsible. Such tax evasion behavior will be effectively curbed. On March 18th, the Supreme People's Court and the Supreme People's Procuratorate jointly issued the "Interpretation on Several Issues Concerning the Application of Law in Handling Criminal Cases Involving Harmful Tax Collection and Management" (hereinafter referred to as the "Interpretation"), which clarifies the conviction and sentencing standards for various types of tax crimes, punishes crimes in accordance with the law, safeguards national tax interests, and maintains tax order. The Interpretation shall come into effect on March 20th. The Interpretation clarifies the legal application of new criminal methods and for the first time explicitly lists the signing of "yin-yang contracts" as a means of tax evasion. According to Article 1 of the Interpretation, taxpayers who make false tax declarations and conceal their income or property in the form of signing "yin-yang contracts" or in the name of others should be recognized as "deceptive or concealing means" as stipulated in Article 201, Paragraph 1 of the Criminal Law. What is the Yin Yang contract? Lu Dingliang, a partner lawyer at Beijing Jingshi Law Firm, told Beijing Business Daily that a "yin-yang contract" refers to two or more contracts signed by the contracting parties on the same matter with different contents. The "Yang Contract" is used externally for the record keeping and registration of regulatory authorities, and is not a true expression of the intentions of both parties; "Yin Contract" is an internal contract signed privately by both parties to avoid regulation and taxation. It is not used for filing and registration by regulatory authorities, but reflects the true intentions of both parties. The Interpretation has frequently dealt with cases of fabricating false tax calculation basis for tax evasion, especially in recent years in the entertainment industry where several cases of hiding or decomposing income and property in the name of others through the signing of "yin-yang contracts" have had a very negative impact. The flag clearly clarifies the signing of "yin-yang contracts" as one of the tax evasion methods, providing a precise basis for judicial organs to handle such cases in the future. Lu Dingliang pointed out that there were different understandings of the nature of certain tax related cases before, and there were also different interpretations of the qualitative behavior of tax evasion through signing "yin-yang contracts". This "Interpretation" for the first time explicitly lists signing "yin-yang contracts" as a means of tax evasion, and has cracked down on a number of cases where individual employees in the entertainment industry use "yin-yang contracts" and other forms to evade personal income tax supervision. "We believe that it will play an important role in reducing the number of" yin-yang contracts "in the future.". "The Interpretation clearly lists the signing of 'yin-yang contracts' as a means of tax evasion, indicating the determination of the' two highs' to punish tax related illegal and criminal acts in the new economic development situation." Wu Libin, director of Beijing Mingshui Law Firm, also stated in an interview with Beijing Business Daily reporters. Regarding the previous handling of the "yin-yang contract", according to Wu Li
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