Interpretation: Administrative Penalties for Internet Platform Tax-Related Information Reporting

关于《国家税务总局 工业和信息化部 国家互联网信息办公室关于规范互联网平台企业涉税信息报送有关行政处罚事项的公告》的解读

Source (Chinese): STA Policy Database — 政策解读 (Tax Administration and Technology Development Division, September 28, 2025)

English translation: Independent translation. Not an official government translation.

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To implement the Provisions on Internet Platform Enterprises' Tax-Related Information Reporting (hereinafter the "Provisions"), the State Taxation Administration, the Ministry of Industry and Information Technology, and the Cyberspace Administration of China jointly issued the Announcement on Regulating Administrative Penalty Matters Related to Internet Platform Enterprises' Tax-Related Information Reporting (Announcement No. 22 of 2025, hereinafter the "Announcement"). The interpretation is as follows:

Q1: What is the background for issuing the Announcement?

Answer: The Provisions took effect on June 20, 2025. To safeguard the lawful rights and interests of internet platform enterprises, regulate the enforcement conduct of tax authorities, and promote compliance by internet platform enterprises in reporting tax-related information in accordance with laws and regulations, the STA, MIIT, and CAC jointly issued the Announcement, specifying and clarifying the penalty requirements and penalty matters under the Provisions.

Q2: What are the main contents of the Announcement?

Answer: The Announcement details penalty matters for non-compliant internet platform enterprises across three dimensions: applicable circumstances, penalty authority, and penalty measures. The main contents are as follows:

Regarding "applicable circumstances": On the one hand, the Announcement encourages internet platform enterprises to promptly rectify violations — no penalty will be imposed if corrections are made within the period specified in the tax authority's order for rectification. On the other hand, it regulates the enforcement conduct of tax authorities and guides internet platform enterprises toward compliant data reporting, by specifying the concrete circumstances constituting "serious circumstances" under the Provisions.

Regarding "penalty authority": Depending on the severity of the violation, general violations are penalized by the competent tax authority of the internet platform enterprise, while serious violations are subject to ordered suspension of business for rectification and fines imposed by provincial-level or higher tax authorities.

Regarding "penalty measures": For internet platform enterprises subject to ordered suspension of business for rectification, the tax authority will adopt a series of measures:

1. Restrict their invoice issuance by suspending invoice allocation, reducing invoice quotas, and similar means, and issue risk warnings when other enterprises issue invoices to them;

2. Publish the relevant internet platform enterprise's violation facts and penalty decisions through official websites, news media, WeChat official accounts, and other channels;

3. Refer the matter, through proper procedures, to relevant regulatory departments to lawfully adopt appropriate disposition measures against the non-compliant internet platform enterprise.

Furthermore, for enterprises that actively rectify during the suspension period and complete tax-related information reporting in accordance with laws and regulations, the relevant penalty measures will be promptly terminated upon confirmation by the tax authority.

Q3: How are the number of violations determined?

Answer: For failures to report or provide tax-related information within the prescribed period, or for omitting or concealing or falsely reporting tax-related information, violations are counted by the number of violation occurrences. An internet platform enterprise that commits a violation discovered by the tax authority and fails to rectify within the ordered rectification period counts as one occurrence. Specifically, failures to report or provide tax-related information within the prescribed period, or omissions of tax-related information, are counted on a rolling 12-month cumulative basis; concealment or false reporting of tax-related information is counted on a cumulative basis throughout the internet platform enterprise's period of existence.

Q4: What circumstances constitute "income splitting" as referred to in the Announcement, and how will the tax authority handle them?

Answer: "Income splitting" as referred to in the Announcement means arrangements by platform-based operators that lack a reasonable commercial purpose, where income that belongs to a single taxpayer is dispersed across multiple taxpayer entities in order to reduce, exempt, or defer tax payments.

For platform-based operators who split income, the tax authority will lawfully collect back taxes and late payment surcharges and impose fines. In particular, where the platform enterprise plans, assists, induces, or instigates platform-based operators to split income, thereby causing the reported tax-related information to be untruthful, inaccurate, or incomplete, the Announcement expressly classifies this as one of the "serious circumstances" under Article 10 of the Provisions, and the tax authority will impose an administrative penalty of ordered suspension of business for rectification.

Q5: After completing rectification, to which level of tax authority should an internet platform enterprise subject to ordered suspension of business apply to have the suspension measures lifted?

Answer: In the spirit of implementing the Regulations on Optimizing the Business Environment, and to help rectified internet platform enterprises resume operations promptly, the application to lift the suspension measures is handled by the competent tax authority for the convenience of taxpayers. After the enterprise has completed the reporting of tax-related information to the tax authority in accordance with the Provisions, it submits an application to lift the suspension to its competent tax authority. The competent tax authority, after verification, reports to the tax authority that issued the suspension order to lift the suspension.

Q6: When does the Announcement take effect?

Answer: STA Announcement No. 15 of 2025 on Internet Platform Enterprises' Reporting of Tax-Related Information specified the timeline for internet platform enterprises to first report the identity information and income information of their platform-based operators and workers. To support effective implementation, the Announcement takes effect from the date of issuance.