Hi everyone. I’m Stephanie LI.
Coming up on today’s program.
Two high profile live-streamers received big fines for tax evasion;
China will buy $150b in farm goods from ASEAN, doubling the current level.
Here’s what you need to know about China in the past 24 hours
Authorities in Hangzhou on Monday slapped massive fines on two influential live-streamers for evading taxes, as the country has been tightening regulations on the online sector to ensure legal and sustainable development.
Following investigations into the two internet influencers, Zhu, also known as “Xueli," was ordered to pay 65.55 million yuan toward overdue taxes and penalties, while the other, Lin Shanshan, will have to pay 27.67 million yuan.
The local tax bureau used big data analyses and found Zhu and Lin evaded personal income tax by setting up sole proprietorships in different places in China in 2019 and 2020, and then recorded their personal salaries as the operating income of their enterprises, a violation of tax laws.
Zhu and Lin posted apologies last night, saying that they will suspend their live streaming and pay the required amounts.
Since online anchoring is an emerging profession, live-streamers can make huge amounts of money at a speed other people cannot even think of. Zhu reportedly evaded 30.37 million yuan in taxes, which means her income must have been at least doubled that amount. While in comparison, China’s per capita disposable income in 2020 was slightly above 32,000 yuan, which means Zhu was making money 2,000 times faster than an average person in China.
Analysts suggested that the widespread media reports about some specific live-streamers’ illicit acts, including the sale of fake and defective items by live-streaming promoters, and cases of the infringement of consumers' rights, showed the market supervisors' intention to further regulate the sector.
President Xi Jinping announced on Monday several major initiatives to boost economic cooperation between China and ASEAN, including striving to import $150 billion worth of agricultural products from ASEAN members over the next five years, offering additional financial assistance to the bloc's economic recovery and anti-epidemic efforts, as well as providing advanced technology.
Greater Bay Area, Greater Future
Shenzhen’s Qianhai issued a guideline on Monday with detailed measures to support Hong Kong financial sectors exploring the Chinese mainland market. The new guideline includes preferential policies to boost financial cooperation between Shenzhen and Hong Kong, such as a 2-million-yuan reward for major financial cooperation platforms, and a 3-million-yuan aid plan for fintech subsidiaries set up by Hong Kong virtual banks in Qianhai.
Update on COVID-19
The Chinese mainland reported 5 new local cases yesterday, including 4 from Liaoning.
Next on industry and company news
The Cyberspace Administration of China (CAC) on Tuesday is stepping up regulations on celebrities and the “fan culture” by setting up a negative list to prohibit celebrity-related content from promoting distorted values, including abnormal aesthetics, hyping of vulgar scandals, and content that induces fans to blindly idolize celebrities or hype the comeback of tainted entertainers.
NetEase’s music streaming business Cloud Village is aiming to raise up to HK$3.5 billion in an IPO, after shelving the deal earlier this year following China's regulatory crackdown on tech companies. Cloud Village will offer 16 million shares at a price between HK$190-220 and start trading on the Hong Kong Stock Exchange on Dec. 2.
Shares in Koolearn Technology, a unit of education giant New Oriental, gained another 4.2 percent today after surging 23 percent yesterday as the company said founder and chairman Yu Minhong has pumped in nearly HK$25 million to increase his holdings. Stocks in the education sector also saw a strong boost in the past days, with Scholar Education jumping 26 percent and Wisdom Education rallying 11 percent.
Wrapping up with a quick look at the stock market
Chinese stocks closed mixed today with stocks of energy-efficient motors, rare earth magnet and steel leading the gains. The Shanghai Composite went up 0.2 percent, while the Shenzhen Component lost 0.37 percent. The Hang Seng Index fell 1.2 percent, dragged by pharmaceutical and tech sectors.
Biz Word of the Day
A sole proprietorship, also referred to as a sole trader or a proprietorship, is an unincorporated business that has just one owner who pays personal income tax on profits earned from the business.
Executive Editor: Sonia YU
Editor: LI Yanxia
Host: Stephanie LI
Writer: Stephanie LI, ZHANG Ran
Producer: XIANG Xiufang
Sound Editor: ZHANG Ran, Andy YUAN
Graphic Designer: ZHENG Wenjing, LIAO Wanni
Co-produced by 21st Century Business Herald Dept. of Overseas News & SFC Audio/Video Dept.
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21世纪经济报道海外部 南财音视频部 联合制作