Overseasidol.com — Chinese actress Liu Xiaoqing is once again under public scrutiny following new tax evasion allegations tied to her privately owned company in Shanghai.
On the evening of May 15, the Fourth Inspection Bureau of the Shanghai Municipal Tax Service, part of China’s State Administration of Taxation, issued a formal statement confirming that it has received a report involving alleged tax-related misconduct by “Liu and related enterprises” and is now investigating the matter in accordance with legal procedures.
The accusations stem from a whistleblower named Mr. Wang, who claims Liu Xiaoqing’s company, Shanghai Yixi Culture Media Center, engaged in tax evasion by manipulating invoice classifications.
According to Wang’s report, the company allegedly issued value-added tax (VAT) invoices at a 6% rate under the guise of “image endorsement fees” to avoid paying over 27% in personal income tax. The transactions in question reportedly total ¥3.3 million (around USD $460,000).
Wang also alleged that Liu’s company lacks a legitimate place of business, has no employees on record, and does not contribute to employee social insurance, suggesting it may be a shell company used for issuing fake invoices.
In response to these serious allegations, Liu Xiaoqing took to social media on the night of May 15 to categorically deny any wrongdoing.
She emphasized that the content of the whistleblower’s complaint does not reflect the facts and stated she does not know the individual behind the report.
Liu added that both she and her company will fully cooperate with tax authorities to verify the situation.
This incident has reignited memories of a similar controversy from 2002, when Liu Xiaoqing was detained for over 400 days after being implicated in a massive tax evasion case involving her business at the time.
That investigation uncovered tax fraud exceeding ¥14.5 million and led to one of the most high-profile tax scandals in China’s entertainment industry.
While the current investigation is ongoing, Liu’s public defense and willingness to cooperate suggest she is aiming to handle the case transparently.
The entertainment industry and public alike are now watching closely to see how the situation unfolds.
