Opinion: Fines on Fan demonstrate government's determination to regulate entertainment industry
Updated 17:29, 06-Oct-2018
By CGTN's Liu Jianxi
["china"]
Editor's note: Liu Jianxi is an opinion editor for CGTN Digital. The article reflects the author's opinions and not necessarily the views of CGTN.
Fan Bingbing, one of China's highest-earning actresses, has been ordered to pay nearly 892 million yuan for tax evasion, Xinhua reported on Wednesday, the first public pronouncement about Fan since she disappeared from public view for over three months. The government said that, as a first-time offender, Fan would not face criminal charges if she pays all the money by an undisclosed deadline.
Making an international name with appearances in Hollywood blockbusters, Fan dropped off the radar in June when reports about her involvement in tax evasion surfaced. The purported contracts posted online suggested the A-list movie star had received a large amount of under-the-table payments.
"Yin-yang contracts" – with one contract for income declared to the authorities and the other setting out the real earnings – have since been thrust into the media spotlight. Apart from Fan, other high-profile movie stars were also alleged to have signed such contracts to conceal true remuneration from tax authorities, reportedly a common practice in the entertainment industry to evade taxes.
Beijing Municipal Taxation Bureau of the State Administration of Taxation in Beijing, China on June 15, 2018. /VCG Photo

Beijing Municipal Taxation Bureau of the State Administration of Taxation in Beijing, China on June 15, 2018. /VCG Photo

The government's blow against Fan-like celebrities is undoubtedly a demonstration of its determination to regulate the entertainment industry and promote societal equity. With its economic rise, the Chinese society, in recent years, has allocated more time and money to movies, TV series and other recreational activities, and the entertainment industry has thus thrived.
Problems arise accordingly. While celebrities are expected to act as role models for the society, some are using their "reputation" to obtain private gains and are even involved in unlawful acts. Earlier, a strand of entertainment stars was punished for taking drugs and soliciting prostitutes, exerting tremendously negative effects on the society.
Moreover, the huge income gaps between so-called A-list stars and ordinary people have aroused widespread complaints among the public. It's nothing new that entertainment celebrities earn tens of thousands of times that of ordinary people. Last year, Fan was listed on Forbes' top-paid Chinese celebrity list with an income of 300 million yuan, an amount that most ordinary employees can never obtain in their whole lifetime.
Fan Bingbing (C) promotes the movie "X Men: Days of Future Past" together with Hugh Jackman (L) and Peter Dinklage (R) on May 15, 2014, in Singapore. /VCG Photo

Fan Bingbing (C) promotes the movie "X Men: Days of Future Past" together with Hugh Jackman (L) and Peter Dinklage (R) on May 15, 2014, in Singapore. /VCG Photo

The Chinese government, in recent years, has stepped up its crackdown on high salaries of actors and their unruly behavior, an act warmly welcomed by the public. In June, the authorities capped leading actors' income at 70 percent of the full cast's and 40 percent of the entire production budget.
Income tax rate for celebrities is also raised this year. With Fan being fined, the government is launching a campaign to recover all back taxes in the entertainment industry, deterring other celebrities from unlawful acts.
It has been only 40 years since China's reform and opening up. It will take time for China to advance into a well-balanced and highly-civilized society. Patience is needed during the process.
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