Golden Tax Phase IV: Key Terms for Tax and Asset Planning (Part 2)

With Golden Tax Phase IV in operation, the tax authorities will hold far more of a company’s data, and monitoring becomes comprehensive and multi-dimensional. This second part of the series explains the four main functions of the system.

1. Smart tax administration driven by big data

Golden Tax Phase IV uses the electronic invoicing reform as its starting point and is driven by tax big data. It builds a complete system for collecting, connecting and aggregating tax and fee data, moving tax administration to a “smart” model.

Through intelligent data collection and efficient management, tax authorities can administer taxes more precisely and efficiently. As a result:

• enforcement is controllable
• results can be evaluated
• misconduct can be investigated
• responsibility can be traced

2. Fully digital invoicing and online tax services

Issuing, transferring and verifying invoices are now fully digital. This significantly improves the efficiency and accuracy of invoice management and reduces the use of paper invoices.

The system also offers a range of online services. These make it much easier for taxpayers to handle all kinds of tax matters and lower their costs:

• online filing
• tax assessment
• tax enquiries
• tax consultation

3. Real-time risk scanning and supervision by risk level

Using big data, artificial intelligence and other advanced technology, the system scans and analyzes companies’ tax filing data, financial data and other information for risk in real time. Potential tax risks are identified and flagged early.

Supervision is differentiated: companies are targeted according to their risk level, which promotes fair competition in the market.

Risk level	How the company is supervised
High-risk companies	Close attention
Low-risk companies	A lighter, more flexible touch

4. Non-tax items and information sharing

Golden Tax Phase IV is not limited to tax. It also covers non-tax items such as social insurance and medical insurance contributions, giving more comprehensive oversight.

Part 3 of this series looks at the impact of Golden Tax Phase IV and what counts as non-tax business. If you want to understand how closer data sharing could affect your own tax and asset planning, a consultant can help you review your situation and the status options open to you.