Dear Colleagues and Friends:

Good New Year to you all! The year 2024 has already waved goodbye to us, and 2025 is just around the corner. 2024 was an extraordinary year. In this year, the macro environment was stable and upward, and the journey of modernising the rule of law in taxation was advanced in an orderly manner. The Third Plenary Session of the 20th CPC Central Committee considered and passed the Decision of the CPC Central Committee on Further Comprehensively Deepening Reform and Promoting Chinese Modernisation, which pointed out the direction of the construction of Chinese modernisation in the new era; the State launched a package of incremental policies, which solidly pushed the economy upwards, the structure upwards, and the development trend continued to be good, so that we could fully feel the pulsation of the high-quality development of China's economy; on the tax level, the CPC Central Committee put forward new requirements for deepening the reform of the fiscal system and made new demands for the reform of tax system. At the tax level, the CPC Central Committee has put forward new requirements for deepening the reform of the fiscal and taxation system, making it clear that it is necessary to improve the tax system that is conducive to high-quality development, social fairness and market unity; the construction of the rule of law in taxation has entered a period of quality improvement and efficiency enhancement under the principle of "comprehensively ruling taxes in accordance with the law", and has achieved outstanding results in terms of scientific legislation, strict enforcement of the law, and fair justice. In the face of stable and orderly political environment, stable and improving economic situation, improving tax law system and increasingly sound financial and tax system, the development of tax lawyers' industry contains unlimited opportunities and possibilities, and the financial and tax legal services market is still a vast blue ocean!

As the first specialised tax law firm in China, Huashui has always taken the responsibility of assisting in the modernisation of the country and the construction of the rule of law in taxation since its establishment in 2006, and has stood out in the wave of the era of tax law changes. In the past year, Huatax has been deeply involved in the journey of modernising the rule of law in taxation:

Giving advice on the rules of law and people’s livehood. In 2024, Huashui advised on new tax laws and policies, proposed amendments to the Draft Customs Tariff Law of the People's Republic of China, comprehensively interpreted the Value-added Tax Law, and conducted a series of studies on the Interpretation by the Supreme People's Court of the Supreme People's Procuratorate of Several Issues Concerning the Application of Law in Handling Criminal Cases of Hazardous Tax Collection and Administration. It also conducted seminars and analyses on a number of tax policies introduced, and analysed in-depth the impact of policy implementation based on years of experience in tax legal services, and jointly promoted the collaborative governance of tax law.

Deeply ploughing into tax legal service and jointly promoting the construction of the rule of law in taxation. In 2015, Huashui took the lead in launching the innovative legal service business of "Taxation, Law, Industry", which is dedicated to safeguarding the legitimate rights and interests of taxpayers and promoting the construction of the rule of law in taxation. 2024, Huashui successfully represented a number of tax administrative and criminal cases with significant social impacts, and, while safeguarding the legitimate rights and interests of taxpayers, promoted the effective resolution of disputes between taxpayers and employers, providing case practice experience for the construction of the rule of law in taxation. While safeguarding and protecting the legitimate rights and interests of taxpayers, it also promotes the effective settlement of disputes between taxpayers and taxpayers, and provides practical experience in the construction of the rule of law in taxation.

Focusing on the exploration of tax-related issues and sharing business research results. In the past year, Huashui has continued to practice the spirit of seeking excellence and pursuing extreme research, and has been leading the development of the finance and tax legal services market. Huashui team has continued to summarise practical experience and research results, and has continuously released industry tax compliance reports (2025) since 27 December 2024, covering ten key industry sectors such as network freight transport, petrochemicals, renewable resources, foreign trade and pharmaceuticals, etc.; Tax Compliance Practices and Cases of Chinese Enterprises, edited by myself and compiled by Huashui, was listed in the market in August 2024, which will provide comprehensive solutions for tax compliance management; China's Enterprise Tax Compliance Practices and Cases, edited by myself and compiled by Huatax, was listed in the market in August 2024, which will provide comprehensive solutions for tax compliance China Tax Lawyers' Review (Volume 11), edited by the All-China Lawyers' Association's Professional Committee on Taxation Law and compiled by me, was published on schedule, providing in-depth interpretation and discussion on typical difficult tax cases. We have also been invited by judicial authorities, tax authorities and industry associations to carry out tax law training, and have been interviewed by China Tax News and other famous media to express our professional opinions on difficult and hot issues related to tax, which has been affirmed and recognised by all sectors of the society.

Cultivating and attracting talent to develop together. In 2024, Huashui continued to fulfil its social responsibility of cultivating talents in the industry by hosting the "Ninth Summer Training Course for Chinese Tax Lawyers, Taxation Technicians and Graduate Students of Tax Law (2024)" and the "Special Seminar on the Judicial Interpretation of Tax-Related Judicial Interpretations of the Two Higher Education Authorities", which attracted over 6,000 online and offline participants. "At the same time, the "2024 Tax Legal Service Business Exchange Meeting" was successfully held, which was jointly hosted by the Finance and Taxation Law Committee of the All-China Lawyers' Association and the Finance and Taxation Law Research Centre of China University of Political Science and Law, and supported by Huashui, and had a significant impact on leading tax lawyers, tax accountants and accountants. The successful convening of "2024 Tax Legal Service Business Exchange Conference", which is of great significance in leading tax-related intermediary service organisations such as lawyers, tax accountants and accountants, as well as the development of the industry, business innovation and strategic cooperation. I am honoured to be elected as a member of the Education and Training Committee of the Seventh China Association of Registered Taxation Technicians and re-appointed as a tutor of Master of Taxation at the School of Finance and Economics of Renmin University of China, and will continue to contribute to the cultivation of talents for the cause of taxation and law.

Adhering to the service concept of professional rigour and diligence, Huashui provides clients with efficient and accurate tax law services, fully safeguards the legitimate rights and interests of taxpayers, and has won a good reputation. 2024, we have been recognised and favoured by a number of internationally renowned organisations, such as Chambers and Partners, Asian Legal Business Journal (ALB), China Business Law Journal (CBLJ), Asian Legal Profiles (Asialaw), LEGALBAND, etc. I am also honoured to have been awarded the "Best Tax Law Firm in China". Asian Legal Business (CBLJ), Asian Legal Profiles (Asialaw), LEGALBAND and other internationally renowned organisations, and has been awarded the "Best Tax Law Firms in China", and I have been honoured to be ranked in the "Top Lawyers in China" and "Top Lawyers in Tax Law in China" lists again. I am also honoured to be listed in the "Top Lawyers in China" and "Top Lawyers in China Tax Law" lists. These achievements were made possible by the trust of our clients and the full support of our partners, as well as the hard work of all Huatax colleagues.

The past is the beginning and the future never ends. Looking ahead to the new year, the legislation on consumption tax is on the verge of being enacted, the real estate tax system is in the pipeline, and the tax legislation is on its last leg. Smart tax is basically completed, tax enforcement, service, supervision and tax big data to achieve in-depth integration and efficient linkage, "tax by numbers" to a new level. The regular and institutionalised data sharing and coordination mechanism between the tax authorities and multiple departments such as public security, customs, banking and financial supervision has been further deepened, and the supervisory capacity has been further upgraded. "In the face of these new situations and trends, Huashui will continue to uphold the craftsmanship of excellence and plough into China's fiscal and tax legal services market in the coming year:

Focusing on service upgrading and helping to rule taxes in accordance with the law. In the new stage of modernisation of the rule of law in taxation, Huashui will be committed to expanding the depth and breadth of its services, and constructing an all-round, multi-level and three-dimensional risk control mechanism with tax risk prevention and control as the core, covering taxpayers' tax risk prevention beforehand, tax risk response in the middle of the process, and tax dispute resolution afterward. With the professional advantages of "Taxation, Law, Industry", we help the effective implementation of the tax law and serve the high-quality development of the economy and the protection of taxpayers' rights and interests.

Strengthening team building and consolidating the foundation of development. Since the establishment of Huashui nearly 20 years ago, Huashui has always insisted on the team's professionalism first and the clients' reputation first, and insisted on maximising clients' interests with the ultimate professional services. 2025, Huashui will further adjust and optimise the internal management and incentive system according to the needs of the market and its own development, continue to absorb talents who are interested in engaging in the tax lawyer industry and have the composite background of finance, taxation and law; at the same time, it will respond to the market's broad demand for finance and taxation Meanwhile, in response to the market's extensive demand for tax and legal services, Huashui Law Firm will start to build a regionalised tax and legal service network, especially in the planning and layout of Shanghai, Guangdong, Chongqing and other regions with urgent service demand.

A new chapter of co-operation and a bright future. "It is not spring when one flower blooms alone, but when a hundred flowers bloom together, spring fills the garden". In the new year, Huashui will continue to play a leading role in the industry, make its voice heard and share its experience by organising activities such as business exchange meetings on tax legal services and summer training courses on taxation. Huashui will also revise and reprint the Practice of Resolving Difficult Tax Cases in China published by Huashui, which is based on the latest tax dispute cases to provide business guidelines for the majority of tax lawyers and promote the common progress of the industry. As an open communication platform, Huashui always adheres to the vision of win-win cooperation. In the new year, we hope to work hand in hand with colleagues in the industry to create a new chapter!

At this wonderful moment of bidding farewell to the old and welcoming the new, I would like to extend the most sincere New Year wishes on behalf of Huashui Group to our customers and partners who have been supporting us for a long time, colleagues of Huashui around the world as well as people from all walks of life who care about and help Huashui! I wish you all good health, smooth work, family happiness and further success in the new year!

Liu Tianyong

1 January 2025