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Even Chinese film stars have to pay their taxes

Crackdown prompted by contracts row involving actress Fan Bingbing is likely to shake the country’s entertainment industry and again highlight the gap between rich and poor

PUBLISHED : Thursday, 07 June, 2018, 4:59am
UPDATED : Wednesday, 03 October, 2018, 12:45pm

Chinese have a love-hate relationship with their top actors. While they flock to their films, pushing China’s cinema towards overtaking Hollywood as the world’s largest in terms of revenue, they are prone to criticising stars for being paid too much.

The tax evasion investigation launched this week into the nation’s film and television industry was therefore inevitable. There can be no sympathy for whoever is found out; everyone has to pay their required dues, no matter how famous they may be.

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A row between superstar actress Fan Bingbing and a television presenter prompted the crackdown. The presenter posted on social media the images of what he claimed were two contracts for the same job, a practice said to be common among some famous actors.

Popularly known as “yin-yang contracts”, one set out agreed payment terms and the other was for a lower amount and apparently meant for tax authorities. Fan has denied the allegation and hired lawyers, but that will not stop the inquiry into her financial affairs and those of her fellow actors.

The last time a famous entertainer was entangled in a tax probe was in 2002, when Liu Xiaoqing, a big name actress and savvy businesswoman, was jailed for a year. But paying taxes owed is one matter; it is the gap between rich and poor and the perceived value of work done that also irks many Chinese.

The biggest expenditure of mainland films is the salary of high-profile actors, which can account for between half and 80 per cent of the production cost. Top names are seen as necessary by investors to draw audiences, but that invariably affects the wages of others in the production team, leading to complaints of poor scripts and low values.

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It will take time for the mainland’s booming film industry to find a balance between the box office appeal of actors and what they should reasonably be paid. There will always be people who feel acting is easy work compared to that of scientists, innovators and risk-takers.

But stars are often seen as role models and an acclaimed performance is also likely to be considered worth the pay awarded. Whatever the case, though, wilfully evading tax is not tolerable, no matter how excellent the acting.