5 ms·

It is a case of lost in translation. Chinese use "invoice" for "receipt" because they use the same official form for actual invoices, I think, as a way of crack

It is a case of lost in translation. Chinese use "invoice" for "receipt" because they use the same official form for actual invoices, I think, as a way of cracking down on tax avoidance. China has one of the highest sales tax at the retail level, including VAT and various fees; so high in fact the actual rate is a state secret. You can imagine the pressure on retailers, particularly, small shop owners, to avoid paying it. The government therefore introduced a system of official invoices that everybody including all retailers must use, and from carbon copy of invoices tax collectors can calculate sales amount and thereby tax owed. That is my understanding, anyway. I have been out of the country for so long, it must have changed a lot. Most of it must be electronic now, I imagine. I still remember a shop owner's audible complaints when I asked for an invoice around the time the system was initially introduced.

bobthepanda 6y ago
How can one accurately charge sales tax if it is a state secret? At least in the US those kinds of taxes are declared on receipts themselves.
- east2west 6y ago
  State secrets in China are not same as classified information in the West. State secrets mean: do not broadcast to average Chinese. It is a censorship tool, it is meant to protect the government from its citizens. You gave an excellent example. Tax rates are NOT on receipts in China. That would put pressure on the government to lower tax.
  - gruez 6y ago
    How hard could it be to find? Can't you ask your friend who's a business owner to tell you the rate?
    - renewiltord 6y ago
      Sure, but will you?
  - yftsui 6y ago
    An average Chinese citizen is only aware of income tax, they don’t realize that they are paying taxes and fees for something say when buying a bag of sugar or salt.
    - anonunivgrad 6y ago
      [I am mistaken]
      - detaro 6y ago
        These pesky hidden taxes that are regular headline news (e.g. when things are (proposed to be) reclassified) and legally required to be listed on each receipt and invoice are indeed so well-hidden from the unsuspecting populace...
        deleted 6y ago
        [deleted]
burntoutfire 6y ago
> China has one of the highest sales tax at the retail level, including VAT and various fees; so high in fact the actual rate is a state secret. How do the private companies know how much taxes to pay then? Or all shops state-run?
- east2west 6y ago
  Many people know the precise rates; it is just that common people do not, which is the whole point. VAT rate is public and I think uniform across the country. Local governments impose various fees and they are not widely known to the public. Relevant accountants and officials know all about the rates but they are not supposed to broadcast it. I saw a clip of Chinese news broadcast giving shocking rates on Youtube, like a quarter to a third, but unfortunately I cannot find it now. There is little public information about effective sales tax rate. However, people do realize it. High taxes is one reason Chinese tourists buy a lot when overseas; they could see the price difference.
  - davidgay 6y ago
    > I saw a clip of Chinese news broadcast giving shocking rates on Youtube, like a quarter to a third, 20-25% VAT is pretty common in Europe, so while that's high I wouldn't go so far as shocking.
    - deleted 6y ago
      [deleted]
    - east2west 6y ago
      Sorry, I wasn't very clear. I meant as the rate of final price. It has been a while so it is a little fuzzy, but I recall the broadcaster said up to 50% of pre-tax price. The official VAT rate is like 17% now, I think (just googled it). So it is other fees imposed by local governments that are onerous.
      - astkaasa 6y ago
perlwle 6y ago
Well it certainly is not a state secret. Just google 'China business tax reform' It was a hot topic back 2, 3 years ago because businesses complained about the high tax rate. Average Chinese may not think about paying tax for each sale because it's not printed on the receipt. But the price they pay do include all the taxes incurred to the business. It's been a while, I remember that the receipts I got from IKEA and 711 do print the exact tax applied to this sale.
- nmfisher 6y ago
  > Average Chinese may not think about paying tax for each sale because it's not printed on the receipt. But the price they pay do include all the taxes incurred to the business. Sure, if you're shopping at IKEA or 7-11 (notably, large-scale foreign businesses). If you're shopping at the local corner store or restaurant, they're not declaring sales unless you specifically ask for a fapiao (and even then, half of them will lie and say their machine is broken).
  - perlwle 6y ago
    JD used to include fapiao in the delivery too. Now It's using E-Fapiao. > If you're shopping at the local corner store or restaurant, they're not declaring sales unless you specifically ask for a fapiao (and even then, half of them will lie and say their machine is broken). Yeah. I agree. Though it's bit extreme to say `half of them`.

bobthepanda 6y ago

How can one accurately charge sales tax if it is a state secret? At least in the US those kinds of taxes are declared on receipts themselves.

east2west 6y ago
State secrets in China are not same as classified information in the West. State secrets mean: do not broadcast to average Chinese. It is a censorship tool, it is meant to protect the government from its citizens. You gave an excellent example. Tax rates are NOT on receipts in China. That would put pressure on the government to lower tax.
- gruez 6y ago
  How hard could it be to find? Can't you ask your friend who's a business owner to tell you the rate?
  - renewiltord 6y ago
    Sure, but will you?
- yftsui 6y ago
  An average Chinese citizen is only aware of income tax, they don’t realize that they are paying taxes and fees for something say when buying a bag of sugar or salt.
  - anonunivgrad 6y ago
    [I am mistaken]
    - detaro 6y ago
      These pesky hidden taxes that are regular headline news (e.g. when things are (proposed to be) reclassified) and legally required to be listed on each receipt and invoice are indeed so well-hidden from the unsuspecting populace...
      - deleted 6y ago
        [deleted]

burntoutfire 6y ago

> China has one of the highest sales tax at the retail level, including VAT and various fees; so high in fact the actual rate is a state secret. How do the private companies know how much taxes to pay then? Or all shops state-run?

east2west 6y ago
Many people know the precise rates; it is just that common people do not, which is the whole point. VAT rate is public and I think uniform across the country. Local governments impose various fees and they are not widely known to the public. Relevant accountants and officials know all about the rates but they are not supposed to broadcast it. I saw a clip of Chinese news broadcast giving shocking rates on Youtube, like a quarter to a third, but unfortunately I cannot find it now. There is little public information about effective sales tax rate. However, people do realize it. High taxes is one reason Chinese tourists buy a lot when overseas; they could see the price difference.
- davidgay 6y ago
  > I saw a clip of Chinese news broadcast giving shocking rates on Youtube, like a quarter to a third, 20-25% VAT is pretty common in Europe, so while that's high I wouldn't go so far as shocking.
  - deleted 6y ago
    [deleted]
  - east2west 6y ago
    Sorry, I wasn't very clear. I meant as the rate of final price. It has been a while so it is a little fuzzy, but I recall the broadcaster said up to 50% of pre-tax price. The official VAT rate is like 17% now, I think (just googled it). So it is other fees imposed by local governments that are onerous.
    - astkaasa 6y ago

perlwle 6y ago

Well it certainly is not a state secret. Just google 'China business tax reform' It was a hot topic back 2, 3 years ago because businesses complained about the high tax rate. Average Chinese may not think about paying tax for each sale because it's not printed on the receipt. But the price they pay do include all the taxes incurred to the business. It's been a while, I remember that the receipts I got from IKEA and 711 do print the exact tax applied to this sale.

nmfisher 6y ago
> Average Chinese may not think about paying tax for each sale because it's not printed on the receipt. But the price they pay do include all the taxes incurred to the business. Sure, if you're shopping at IKEA or 7-11 (notably, large-scale foreign businesses). If you're shopping at the local corner store or restaurant, they're not declaring sales unless you specifically ask for a fapiao (and even then, half of them will lie and say their machine is broken).
- perlwle 6y ago
  JD used to include fapiao in the delivery too. Now It's using E-Fapiao. > If you're shopping at the local corner store or restaurant, they're not declaring sales unless you specifically ask for a fapiao (and even then, half of them will lie and say their machine is broken). Yeah. I agree. Though it's bit extreme to say `half of them`.