Chinese movie star Fan Bingbing slapped $129 million fine for tax evasion

BEIJING (Reuters) - China has ordered movie star Fan Bingbing to pay about 884 million yuan ($129 million) in overdue taxes and fines on Wednesday, as a crackdown on tax evasion in the entertainment industry gathers momentum.

The 37-year-old actor, whose June disappearance touched off wild speculation about her whereabouts, has appeared in the “X-Men” and “Iron Man” film franchises, attracting more than 62 million online followers in China.

An investigation by Chinese tax authorities found Fan had split her contract to evade taxes of 7.3 million yuan ($1.1 million) over payments for her role in “Air Strike”, a film due to be released this year.

Fan and companies she represented also evaded 248 million yuan ($36 million) in additional taxes, local media reported, but it gave no details regarding this figure.

The tax bureau in the eastern coastal province of Jiangsu delivered its judgment to Fan on Sunday, levying fines of more than 596 million yuan ($86.7 million) for tax evasion and assessing overdue taxes of more than 288 million yuan ($42 million).

In a letter posted on her official account on the Twitter-like platform Weibo, Fan said she fully accepted the authorities’ decision, would overcome “all difficulties” to pay the penalties, and step up supervision of her companies.

“I’m ashamed of my behavior and I apologize here to everyone,” Fan wrote.

“Every bit of my achievement is inseparable from the support of the state and the people. Without the good policies of the Communist Party and the state, without the love of the people, there is no Fan Bingbing.”

Under Chinese law Fan, as a first-time offender, would face no criminal charges if she complied with the judgment and paid all the money by an undisclosed deadline.

Since June, China has been investigating tax evasion in its film and television industry, following reports that some of its most famous actors have been accused of signing so-called “yin-yang” contracts, one of which sets out the real terms, while a second, with a lower figure, is meant for tax officials.

The State Administration of Taxation (SAT) said companies and individuals in the industry who voluntarily “rectify their behavior” and pay back taxes evaded prior to December 31 will be exempt from administrative punishment and fines.