Shanghai tax authorities have recently uncovered two significant cases of export tax rebate fraud, demonstrating their commitment to maintaining fiscal order and combating economic crimes. The crackdown highlights how some entities have abused a policy designed to support foreign trade development for illicit gains.
Jinhui Investment: Fabricated Exports Lead to Decade-Long Sentences
The Third Inspection Bureau of Shanghai Taxation Bureau, in collaboration with public security authorities, successfully prosecuted Shanghai Jinhui Investment Industrial Co., Ltd. for export tax rebate fraud. Investigations revealed that between 2019 and 2024, the company systematically fabricated export transactions and forged supporting documents to illegally claim tax rebates.
Tax authorities recovered 16.3973 million yuan in fraudulent rebates and imposed additional penalties after obtaining conclusive evidence. The case was handled according to China's Tax Collection and Administration Law.
The principal offenders, Li Jinsong and Hua Yunfei, received prison sentences of ten-and-a-half years and ten years respectively for export tax rebate fraud. These substantial penalties serve as a strong deterrent against similar crimes.
A spokesperson from the Third Inspection Bureau emphasized that tax authorities will continue strengthening cooperation with law enforcement agencies to establish tighter supervision mechanisms. The bureau maintains a zero-tolerance policy toward invoice fraud and illegal tax rebate claims to uphold fiscal integrity and social justice.
Ruchen International: Document Forgery Nets Multiple Convictions
In a separate operation, the Fifth Inspection Bureau exposed Ruchen International Trade (Shanghai) Co., Ltd.'s elaborate scheme to defraud the export rebate system between 2020 and 2023. The company created fictitious transactions by forging value-added tax invoices, customs declarations, and foreign exchange records despite having no genuine business operations.
Authorities recovered 4.6148 million yuan in illegal rebates and collected additional overdue taxes after a thorough investigation.
Eleven individuals involved in the case, including Yan Wenguan, received prison sentences ranging from three to fourteen years for multiple offenses including export tax rebate fraud, VAT invoice forgery, and illegal business operations.
The Fifth Inspection Bureau reaffirmed its commitment to intensifying enforcement efforts against all forms of tax-related crimes. Officials cautioned businesses to operate within legal boundaries, warning that any attempts to exploit fiscal policies for unlawful profits will face severe legal consequences.