Chinese Regulators Curb on Live-streaming Industry

According to an announcement on Wednesday by China’s State Taxation Administration, three government departments in the country recently issued documents regulating live-streaming profit-making. The paper requires cracking down on tax-related crimes while requiring live-streaming platforms to submit the revenue information of streamers every six months.

This document was jointly issued by the Cyberspace Administration of China, State Taxation Administration and State Administration for Market Regulation.

According to the document, live-streaming platforms need to strengthen the management of live-streaming accounts and submit account information such as personal identity, online nickname, payment account, income type and the total profits of live-streamers.

Live-streaming platforms and live-streamers shall not attract audience and induce them to buy products or services using false marketing or tipping. Further, the document also requires live-streaming platforms fulfilling the obligation of withholding and remitting personal income tax according to law.

In recent years, the development of live-streaming has gone into full swing. The industry was boosted by the epidemic, which has played an important role in promoting flexible employment and economic development for those looking who may not have been otherwise able to get to a workplace. Live-streaming services in China, including those operated by ByteDance, Kuaishou and Huya, are viewed by roughly 70% of the country’s internet users, according to the state-run China Internet Network Information Center.

However, the live-streaming industry faces many difficulties, such as fraud, wealth collection, tax evasion and other issues.

In December, 2021, the taxation department of Zhejiang Province found that Viya, a popular live-streamer in China, evaded taxes totaling 643 million yuan ($101 million) and underpaid other taxes by 60 million yuan. China’s state broadcaster took the opportunity during the annual 315 Gala this year to shine a light on fraudulent practices in the live-streaming sector.

SEE ALSO: Chinese Livestreaming Queen Viya Fined $210.3 Million for Tax Evasion

Every year, the number of legal disputes arising from digital tipping during a live-stream has been increasing. In one article published by The Wall Street Journal on Tuesday, reporters found that Chinese authorities are drafting new regulations to cap internet users’ daily monetary spending on digital tipping. Further, officials are also planning to set a daily limit on how much live-streamers can receive from fans and are considering imposing tighter censorship over content, some of the people said.