Tax evasion probe underway in film industry

The State Administration of Taxation has ordered local tax bureaus to investigate the so-called "twin contracts" among film celebrities, following an allegation made by a former China Central Television host that it is a common practice in the film industry to "used this method to evade tax."

Cui Yongyuan, former host of CCTV's popular talk show “Tell it like it is,” shared a number of blacked-out contracts on Weibo since May 28, alleging someone was offered a total of 60 million yuan (US$9.34 million) as the reward for the four-day work in a movie by signing twin contracts.

Cui Yongyuan, former host of CCTV's popular talk show "Tell it like it is", attends a press conference in Beijing, China, 30 August 2016.[File Photo: IC]

By signing the twin contracts – one setting out agreed payment terms and another with a lower figure for the tax authorities – actors and actresses are able to pay less tax, claimed industry insiders.

However, Cui didn’t provide any evidence of the existence of  larger-payment contract, nor did he identify any person.

Netizens at first believed Cui was talking about Fan Bingbing, a famous Chinese actress. But Cui later denied that Fan had anything to do with it.

The State Administration of Taxation ordered local tax bureau in Jiangsu and other places to launch a thorough investigation into the twin-contract issue, it said in a statement posted on its official website on Sunday.