Beware of Fake Receipts From China!
Aug 7th, 2007 by Yue
A few times a week, I receive emails originating from China similar to this:
您好！我公司现有全国多个省市发票优惠代开，经营范围广，发票验证后付款，有需来电联系。陈先生
In English:
Hi, my company offers receipts issued from multiple cities and provinces in China, covering a wide variety of businesses. Payment is accepted after verification of receipts. If you have a need, please call Mr. Chen
Most countries allow companies to deduct certain expenses against their income, thereby reducing their taxes. China is no exception, and showing typical Chinese ingenuity, there are now Chinese companies that are happy to sell you fake receipts that look just like the real thing. And in fact, I hear its becoming a common practice. So beware of fake receipts from China!
I can understand the use of fake tax receipts being common within the PRC for Chinese Companies and foreign corporations doing business here that must report to China’s government tax authorities.
However, western taxation agencies such as Britain’s Inland Revenue or the U.S’s IRS probably have stricter requirements for receipts from abroad to qualify for tax exemptions.
I don’t see how legitimate western businesses could take part in such a scam without being found out, considering the heavier scrutiny they have to undergo from China’s regulators and from their home countrie’s tax authorities.
Keep in mind, it’s not just governments and taxes - it’s also business expense reports. When I worked in D.C., there was a garage next door to my building which printed receipts with a machine that accurately reflected the charges. Half a block away, there was a garage with slightly higher rates that simply provided blank receipts you filled in yourself.
While the automated machine was more popular with tourists and the self-employed, corporate employees preferred the blank-receipt method, where they could not only be reimbursed for the higher cost, but actually “pad” the amount and make a profit.
This sounds similiar to the vendors by the subway exits selling receipts. I think the idea is that you take the subway (for 3 yuan) and buy an unused taxi receipt to be re-imbursed for the cost to take a taxi.
“”"However, western taxation agencies such as Britain’s Inland Revenue or the U.S’s IRS probably have stricter requirements for receipts from abroad to qualify for tax exemptions.”"”
LOL I assure you they don’t. And neither do corporate expense departments. Hell, on my expense reports, I don’t even *NEED* receipts for expenses under $75!
[…] ” … Most countries allow companies to deduct certain expenses against their income, thereby reducing their taxes. China is no exception, and showing typical Chinese ingenuity, there are now Chinese companies that are happy to sell you fake receipts that look just like the real thing.” [Link] […]