Tax Code

It is common practice in Taiwan to have two accounting books for small business. My mom kept one book for tax purpose and another one for real in/out cashflows. Quite a few Taiwanese who have business in China have done the same. However, the taxation and law systems are very different.

In China, the tax auditing force is so large that they can carry out throughout investigation to almost all business. Cooking the book or producing fake invoice is criminal offense (affecting national economic growth). Offenders cannot simply get out by paying fines. They are arrested and imprisoned, or even death penalty depending on how much tax you own.

The staticstic shows there are at least 90,000 Taiwanese being detaining in Chinese prisons.