network judicial auction with low price, convenient by widely welcomed, but in which there is also a tax risk. Judicial auctions usually through the "Notice to Bidders" or "Auction Notice" show that "the buyer with the "confirmation of auction sale" and the relevant legal instruments to the relevant departments for the transfer of property rights transfer formalities, the required taxes and fees are borne by the buyer." In practice, do all the taxes and fees include the taxes and fees owed by the seller in its business? Does it include taxes and fees unrelated to the registration of change of ownership? Due to the agreement is not clear as well as the tax amount involved in the case is huge and lead to the buyer and seller, the buyer and the tax authorities between the dispute, this paper intends to through the current legal norms and judicial practice jurisprudence, on the relevant issues for readers to sort out reference.

I. the high court case law is clear: the buyer does not need to bear the change of ownership has nothing to do with the taxes and fees

I searched through the referee network, found that in practice, the courts around the "bidding instructions" or "auction notice" in the "buyer with the" auction confirmation "and the relevant legal instruments to the relevant departments for the transfer of title transfer formalities, the required taxes, fees are borne by the buyer. In the "required taxes, fees" border determination is not uniform, resulting in the legitimate rights and interests of the buyer is not effectively protected. Recently, the supreme people's court, jiangsu province high people's court has made the relevant decision rules: that is, for the change of ownership has nothing to do with the tax, the buyer does not need to bear, which contains both the buyer for the change of the registration of the tax does not need to pay, but also contains the executor of the tax owed.

Ltd. acquired a piece of land of Chengdu Rehabilitation Hospital Co., Ltd. by auction. After the auction, due to the dispute over the payment of urban land use tax, Chengdu Technology Co. sued Chengdu Rehabilitation Hospital to the People's Court on the following grounds: a. The urban land use tax in question was the behavioral tax arising from the use of land by Chengdu Rehabilitation Hospital in the course of its operation, which had nothing to do with the present auction transaction, and Chengdu Chengdu Rehabilitation Hospital did not declare the tax incentives, which was an important reason for the tax, and Chengdu Rehabilitation Hospital should bear the tax by itself; Secondly, the enforcement court did not publicize the huge amount of urban land use tax in the Auction Notice before the auction, and did not require the buyer to bear the tax, knowing that the property rights might generate high tax and having the ability to investigate and verify the tax burden. The case went through first and second instance, and finally the Supreme People's Court issued a final civil judgment (2022) Supreme Court Civil Re-examination No. 59, which held that in the auction, taxes and fees unrelated to the registration of change of ownership did not fall within the scope of all taxes and fees required to be borne by the buyer in the Auction Announcement, and should be borne by the seller.

Zhao Mou in January 17, 2018 bidding Yangzhou Intermediate Court disposal of "201 room property", bidding success in the specified time to pay the full amount of the auction, but in the handling of the property transfer, found that the homeowner in the original purchase of the house owes the state deed tax has not been paid, and the judge to communicate with the judge, the judge to the "Bidding Announcement" of the provisions of the sixth article: All taxes and fees arising in the course of the transaction shall be borne by the buyer" as the reason, forcibly required to bear the seller to purchase the house owed the state deed tax. Zhao was not convinced and sued to the People's Court, and the Jiangsu Provincial Higher People's Court made the (2018) Su Enforcement Ruling No. 113 to the effect that the tax owed by the executed person in the previous transaction was not incurred in the course of the current transaction, and therefore should not be borne by the buyer.

II.  the buyer should not bear the taxes and fees unrelated to the registration of change of ownership

First of all, from the legal provisions of the level of analysis, according to the supreme people's court on the people's court network judicial auction provisions of article 6, paragraph 2 and article 14, paragraph 3, the judicial auction should explain the status of the auction property, the burden of the rights and other content, and in the auction notice, especially the auction of the property is known to be defective and the burden of the rights. Similar information on the defects and burdens of the auctioned property shall be available to the executed person. In addition, according to Article 8(2) of the Law of the People's Republic of China on Administration of Tax Collection, the tax authorities shall keep the situation of taxpayers and withholding agents confidential in accordance with the law, therefore, in the case that the seller did not express all the taxes and fees and the buyer was unable to enquire the information of the executed person's tax debts from the tax authorities, the buyer could only reasonably foresee the burden of the taxes and fees formed by the change of ownership itself, and taxes and fees unrelated to the change of ownership would generally not be reasonably foreseeable. The buyer can only reasonably foresee the tax burden formed by the change of ownership itself, and the tax not related to the change of ownership will not be reasonably foreseeable.

Secondly, from the legal interpretation level analysis, the "auction notice" usually with general plus enumeration way agreed the buyer need to bear the tax, generalization that "for the process involved in the buyer and seller need to bear all the taxes, fees and need to make up for the relevant taxes, fees," enumeration that is bracketed in the relevant taxes and fees. According to the common understanding, the buyer should bear the tax should be listed first, if a tax does not belong to the enumerated items, it should be judged whether it belongs to the "general" category. However, there is a major premise that is easily ignored, that is, the buyer is required to bear only "involved in the process". Therefore, taxes and fees not related to the registration of change of ownership do not belong to the taxes and fees "in the process", such as urban land use tax.

Finally, from the judicial practice level analysis, according to the "supreme people's court on the people's court network judicial auction a number of issues of the provisions of article 30," "due to the network of judicial auction itself the formation of the tax, should be in accordance with the provisions of relevant laws and administrative regulations, by the corresponding subject; there is no provision or the provisions of the people's court, the people's court can be based on the principles of the law and the actual situation of the case to determine the relevant tax The people's court may, in accordance with the principles of law and the actual situation of the case, determine the relevant subject and amount of the tax." Accordingly, the network judicial auction itself can foresee the formation of the change of ownership tax, in principle, but also by the legal provisions of the taxpayer, and the change of ownership has nothing to do with the bidder beyond the foreseeable tax should be borne by the legal taxpayers, unless the buyer and seller have a clear and specific special agreement.

III. the buyer should not bear the executor of the previous business owed taxes and fees

On the one hand, from the legal provisions, according to the supreme people's court on the people's court network judicial auction of several issues of the provisions of article 30, due to the network judicial auction of the formation of the tax itself, should be in accordance with relevant laws and administrative regulations, by the corresponding subject; no provisions or provisions of the people's court can determine the tax according to the principles of the law and the actual situation of the case of the relevant subject The people's court may, in accordance with the principles of law and the actual situation of the case, determine the relevant subject of the tax or fee. Therefore, the executor's previous tax arrears should not be borne by the buyer according to law. Even though the Notice of Bidding announced that "the property is pre-registered under the name of the executed person, and the property certificate and land certificate have not been issued, and it will take some time to apply for the relevant certificates of entitlement, and because of the lack of initial registration, it may involve a higher tax" and "all taxes and fees arising in the course of the transaction shall be borne by the buyer", etc., the content of this Notice was not clear. " and so on, but the content of the announcement does not conclude that the executed person in the previous transaction owed taxes and fees borne by the buyer of the meaning of the expression, which has far exceeded the reasonable expectations of the buyer.

On the other hand, in terms of practical operation, Article 45 of the Law of the People's Republic of China on Administration of Tax Collection stipulates that where the tax authorities collect taxes, the taxes shall take precedence over the unsecured claims unless otherwise provided by the law; where the taxes owed by the taxpayer occur before the taxpayer has set up mortgages or pledges against its property or the taxpayer's property has been subjected to liens, the taxes shall be enforced prior to the mortgages, pledges or liens. The State Administration of Taxation's Reply Letter to the Supreme People's Court on Tax Issues Related to the People's Court's Enforcement of the Executed Person's Property also requires that, "In view of the fact that the people's court actually controls the income from the taxpayer's property that has been auctioned or sold as a result of the enforcement activities, according to Article 5 of the Law of the People's Republic of China on the Administration of Taxation Collection, the people's court shall assist the tax authorities to prioritize the collection of taxes from such income in accordance with the law." In summary, for the unpaid taxes and fees incurred by the executed person in the previous transaction, the people's court shall assist the tax authorities to pay them from the auction proceeds in accordance with the law, and they should not be borne by the buyer.

IV  the buyer to deal with tax-related risks related recommendations

(I) participate in the auction before a good investigation, prudent calculation of tax costs

Buyers should participate in the auction before the value of the subject matter of the auction, the composition of the tax, whether it contains defects, such as full investigation, research and judgment, such as waiting until after the end of the auction to find out the relevant issues will face a dilemma, pay the relevant taxes, you need to bear the high cost; do not pay the relevant taxes, you may be facing the assets can not be timely transfer, and even owe the tax was taxed by the tax bureau of the tax risk. Accordingly, the buyer should clarify the cost of taxes and fees before participating in the auction to reduce tax-related risks.

(II) Safeguarding one's own interests by claiming the invalidity of the tax package clause

The Supreme People's Court in the "Notice on Further Regulating the Issues Related to Online Judicial Auction of Properties" clearly put forward: "Prohibit in the auction notice contained 'the current transaction tax and fees borne by the buyer in general' or similar content", and proposed to "strive to clarify the approximate amount of transaction taxes and fees, etc., to the bidders before the auction, so as to stabilize the expectations of the bidders and reduce disputes after the fact."

The State Administration of Taxation (SAT) also clearly stated in the "Reply of the State Administration of Taxation to Proposal No. 8471 of the Third Session of the Thirteenth National People's Congress" in September 2020 that it would abolish the pass-through clause in the notice of judicial auctions of immovable property whereby the buyer bears the tax and fees, and uniformly replace it with the proposal that "the tax and fees should be borne by each party".

Based on the provisions of the Supreme People's Court and the State Administration of Taxation, the buyer can claim that the tax clause is invalid, the legal taxpayer to avoid the tax liability on the grounds of the court trial adjusted to the seller, the buyer to bear the corresponding taxes, fees, tax payment mode.

(III) Applying for the court to prioritize the deduction of taxes and fees related to tax underwriting clauses

According to the "State Administration of Taxation on the People's Court to enforce the execution of the property of the executor of the tax issues related to the reply" (State Taxation Letter [2005] No. 869), Article 4: "In view of the people's courts actually control the taxpayer due to the enforcement activities of the income from the auction and sale of the property, in accordance with the "People's Republic of China Taxation Levy and Administration Law", Article 5 of the regulations. the people's court shall assist the tax authorities in prioritizing the collection of taxes from such income in accordance with the law." Accordingly, in the event that the buyer advances the tax that should be borne by the seller, the buyer can reduce its own costs by seeking to negotiate with the people's court for a deduction from the auction proceeds ahead of the execution case.