Editor's Note: The Supreme Law and the Supreme Prosecutor's Judicial Interpretation on Taxes Involving (Legal Interpretation [2024] No. 4) has "inadvertently" allowed the crime of illegal sale of VAT invoices to "resurface" while restricting the crime of false issuance of VAT invoices, and the issue of the application of this crime has triggered certain concerns and heated debates. The issue of the application of this crime has aroused certain concerns and heated discussions. In the author's opinion, in the case that handwritten VAT invoices have been completely replaced by machine-printed invoices and completely withdrawn from the stage of history, the judicial interpretations of the Supreme Court and the Supreme Prosecutor's Office relating to taxes have limited the crime of false invoicing but at the same time, they have forced some local judicial organs to reactivate the crime, which resulted in the confusion of the expanded application of the crime, and this inappropriate trend needs to be corrected and curbed urgently.

01 Introduction

Since the tax-related judicial interpretations of the Supreme Law and the Supreme Prosecutor came into force on March 20 this year, the issue of the application of the crime of false VAT invoices to the crime of tax evasion and the crime of illegal sale of VAT invoices has triggered extensive attention and heated discussions in the theoretical and practical circles. It can be observed that since the implementation of the tax-related judicial interpretations of the Supreme Law and the Supreme Prosecutor, the number of cases in which the crime of illegal sale of VAT invoices has been sentenced in practice has increased at a remarkable rate, and the crime and the crime of false invoicing can also be sentenced to a maximum of life imprisonment, which can't help but make people think and be alert to whether the "activation" of the crime of illegal sale of VAT invoices is "reborn" or "reborn". Does the "rebirth" of the crime of illegal sale of VAT invoices have the possibility of expanding its application and bringing harm to innocents?

In practice, there may be judicial authorities charged with the crime of illegal sale of VAT invoices, the logic is that since the Supreme Law and the Supreme Prosecutor's tax-related judicial interpretation of the second paragraph of Article 10 clearly stipulates the circumstances under which the crime of false invoicing is committed, resulting in a lot of behaviors that are falsely invoiced but actually do not constitute the crime, and at the same time, the act of falsely invoicing is usually accompanied by means of profit by means of charging the invoicing fee, the judiciary turned to the accusation of The crime of illegally selling special invoices for value-added tax. This kind of logic and practice is obviously "there is a policy above and a strategy below", which will undoubtedly lead to new disputes in practice, and people cannot help questioning that the tax-related judicial interpretations of the Supreme Court and the Supreme Prosecutor's Office seem to be "pressing the gourd to float up the ladybird", which, on the one hand, has made a restrictive interpretation of the crime of falsely opening invoices, and on the other hand, has promoted the crime of illegally selling VAT special invoices. On the one hand, the judicial interpretation of the Supreme Law and the Supreme Prosecutor's Office on tax-related issues seems to be "pressing the gourd to float the dipper", and on the other hand, it contributes to the application of the crime of illegal sale of VAT invoices, which will give rise to new practical problems.

02 The "past and present" of the crime of illegal sale of VAT invoices

To judge whether the crime of illegal sale of VAT invoices is correctly or incorrectly applied in judicial practice, we should return to the constituent elements of the crime. Before that, the author should first sort out the crime of illegal sale of VAT invoices in its "past life", i.e., the historical development of the crime, in order to better understand the historical background and legislative purpose of the introduction of the crime.

(i) Traceability of the crime: the predecessor of the crime of illegal sale of VAT invoices was the crime of speculation.

The introduction of the crime of illegal sale of VAT invoices has its special historical background and carries a specific historical mission, and the predecessor of this crime is the pocket crime that has been abolished - the crime of speculation.On December 13, 1993, the State Council issued the Provisional Regulations of the People's Republic of China on Value-added Tax (VAT), which was put into effect on January 1, 1994, thus establishing China's value-added tax system and the supporting system of controlling taxes by invoices. The State Council promulgated the Provisional Regulations of the People's Republic of China on Value-added Tax on December 13, 1993, which came into effect on January 1, 1994, thus establishing China's value-added tax (VAT) system as well as the supporting system of controlling the tax by invoices and deducting the tax by invoices, and the VAT invoices began to ascend to the historical stage. Since China's special VAT invoices in the 1990s were usually sold by tax authorities to general taxpayers in cost sets, taxpayers filled in the invoices by hand when using the invoices, and the invoice inspection capacity of tax authorities was insufficient at that time, a large number of forgeries, dumping and theft of blank special VAT invoices appeared at once since the beginning of 1994.

The two High Commissions, together with the General Administration of Taxation, launched a special struggle against the abovementioned unlawful phenomena. The focus of the fight is on "criminal gangs that forge, sell or steal invoices, especially those that use underground printing factories to print large quantities of fake invoices; those that make forgery and selling of invoices their regular business or profiteering; and those that use fake invoices to engage in tax evasion and fraudulent export tax rebates." In order to equip the special struggle with the supply of the criminal law system, on June 3, 1994, the two high courts issued the Provisions on the Application of Laws in Handling Criminal Cases of Counterfeiting, Dumping, and Theft of Invoices (No. 25 of the Higher Prosecutors' Association [1994]), which stipulates that, "For the purpose of profit-making, illegally printing (duplicating), dumping and selling invoices (including fake invoices) or illegally manufacturing or dumping invoices of anti-counterfeiting special products. If the circumstances are serious, criminal liability shall be pursued for the crime of speculation." And "Anyone who illegally issues or falsely issues invoices for others for the purpose of making profits with an aggregate amount of more than 50,000 yuan, or illegally issues or falsely issues VAT invoices for others with an aggregate amount of more than 10,000 yuan of tax deduction, shall be held criminally liable for the crime of speculation." During the period of the special struggle, the State Administration of Taxation had notified a number of typical cases, including the Nanjing case (Guo Shui Fa [1995] No. 74), the Hohhot case (Guo Shui Fa [1995] No. 182) and the Shanghai case (Guo Shui Fa [1995] No. 205), and a brief excerpt of the cases is as follows:

Nanjing case: Xiao Li, a specialized administrator of Baixia Taxation Sub-bureau of Nanjing Municipal State Administration of Taxation, colluded with Wei Zili, an unlawful businessman, both internally and externally, and imitated the handwriting and signature of another specialized administrator of the Bureau to fraudulently collect 101 VAT invoices in the names of several companies from March 1994 to January 1995, and then falsely issued, opened, and sold out by Wei and others; Zhou Chunzeng, a specialized administrator of Qinhuai Taxation Sub-bureau of Nanjing Municipal State Administration of Taxation, colluded with Wu Zhanglin, a lawless element, internally and externally, and then sold 179 VAT invoices by Wu to the outside world for profit. Zhou Chun, an administrator of Qinhuai Taxation Sub-bureau of Nanjing State Taxation Bureau, had colluded with the wrongdoer Wu Zhanglin both internally and externally, and fraudulently purchased 179 VAT invoices in the name of several companies from January to August 1994, which were then resold by Wu for profit.

The Hohhot case: a major case occurred at the Yuquan District Branch of the Hohhot State Taxation Bureau, in which a counter-ticket seller colluded internally and externally with a foreign outlaw to steal and sell 107 special invoices. The investigation found that Li Yunyan, a temporary staff member of the Yuquan Sub-bureau, had been hired and put in charge of a number of tasks such as special invoices collection, ticketing, bookkeeping, and payment collection, which resulted in a huge supervisory loophole; and that Wang Jinlong, who had been colluding with Li both internally and externally, had fraudulently collected special invoices for external sale by means of impersonation.

Shanghai case: Shanghai Huangpu District State Taxation Bureau, the seventh tax administrator Yao Qiang, Liu Min use work, from the second half of 1994 to April 1995, using impostor, private seal engraving means fraudulent purchase of special invoices 20 and sold to the Wenzhou unlawful elements Hu Licheng, illegal profit of 195,000 yuan; in addition, Yao, Liu, the two will be written off should be privately stolen eight special invoices, sold to the Wenzhou In addition, Yao and Liu also stole 8 special invoices that should be surrendered and sold them to the Wenzhou outlaw Zhao Pinli, making an illegal profit of 58,000 yuan.

In these officially notified cases, staff members of the tax authorities (e.g., special controllers and counter agents) colluded with outside elements to illegally obtain blank, cost-set VAT invoices by fraudulent means (e.g., forged handwriting, impersonation, and engraving of official seals), and then sold them to the outside world for profit; and the units that purchased these illegal invoices seized illegal tax benefits by means of fictitious invoicing. According to the judicial interpretation at that time, these behaviors were dealt with as the crime of speculation. As China was vigorously developing a market economy at that time, the crime of speculation had to be completely abolished, but at the same time, in order to meet the needs of cracking down on invoice crimes, the Standing Committee of the National People's Congress established four major invoice crimes through the formulation of a separate criminal law to replace the to-be-abolished crime of speculation.

(ii) Emergence: 1995 decision to create the crime of illegal sale of VAT invoices by means of a separate criminal law

On October 30, 1995, the Sixteenth Meeting of the Standing Committee of the Eighth National People's Congress made the Decision of the Standing Committee of the National People's Congress on Punishing the Crimes of False Opening, Counterfeiting and Illegal Selling of Value-added Tax Exclusive Invoices (Decree of the President No. 57) (hereinafter referred to as the 1995 Decision), which split the pocket crime of "false opening", "forgery", "sale" and "purchase" into four. (hereinafter referred to as the "1995 Decision"), dividing the original pocket crime of speculation into four, and creating four categories of invoice crimes: "false invoicing", "forgery", "sale" and "purchase". Four types of invoice crimes were created. Article 3 stipulates, "Anyone who illegally sells VAT invoices shall be sentenced to fixed-term imprisonment of less than three years or criminal detention, and a fine of more than 20,000 yuan and less than 200,000 yuan; if the quantity is large, he shall be sentenced to fixed-term imprisonment of more than three years and less than 10 years, and a fine of more than 50,000 yuan and less than 500,000 yuan; if the quantity is huge, he shall be sentenced to more than 10 years of fixed-term imprisonment or life imprisonment, and property shall be confiscated. " As a result, the crime of illegally selling special VAT invoices has entered the criminal law arena in the form of a single criminal law provision.

Looking back at the three major cases disclosed by the General Administration of Taxation mentioned above, of the four crimes created by the 1995 Decision, only the crime of "sale" corresponds to the acts of the criminals in these three cases. In other words, the target of the crime of illegal sale of VAT invoices created by the 1995 Decision is the criminal act of using internal and external collusion, fraud and malpractice, etc. to sell illegally obtained blank VAT invoices to the outside world for profit, as highlighted by these three major cases, and the specific object of the crime is the blank VAT invoices at cost, and the specific subject of the crime is the staff of the tax authorities and the external wrongdoers. The subject of the crime is the staff of the tax authorities and the external wrongdoers. This is the legislative purpose and intent when this crime was introduced.

This viewpoint of the author is not an empty wind, but is based on evidence.After the introduction of the decision in 1995, Tang Weiping of the Criminal Law Office of the Legal Affairs Commission of the Standing Committee of the National People's Congress (NPC) published an article entitled "Brief Introduction to the Decision on the Punishment of the Crimes of False Opening, Counterfeiting and Illegal Sale of Value-added Tax Invoices" in the periodical of the NPC Newsletter (later renamed as the China NPC Magazine) on Dec.1, 1995. "The article gives an authoritative interpretation of the crime of illegal sale of VAT special invoices. The article points out that "the crime of illegal sale of VAT invoices stipulated in Article 3 of the Decision mainly refers to the illegal sale of VAT invoices by the staff of tax authorities and the illegal sale by general taxpayers of VAT invoices legally in their possession". This authoritative view also clearly reflects the aforementioned legislative purpose and intent of this crime.

(iii) Historical development: the formulation of the offence of illegal sale of VAT invoices has never been adjusted.

After the issuance of the 1995 Decision, the Supreme People's Court issued the Interpretation on Several Issues Concerning the Application of the Decision of the Standing Committee of the National People's Congress on Punishing the Crimes of False, Counterfeit and Illegal Sale of Value-added Tax Specialized Invoices (Fa Fa [1996] No. 30) on October 17, 1996.Article 3 of the 1996 Interpretation clarifies the threshold and the sentencing criteria of "larger quantity" and "huge quantity" for the crime of illegal sale of value-added tax specialized invoices. Article 3 of the 1996 Interpretation specifies the threshold for the criminalization of the crime of illegal sale of VAT invoices and the sentencing criteria of "large quantity" and "huge quantity", without providing special explanations on the description of this crime.

When the Criminal Law was revised in 1997, all the invoice crimes in the 1995 Decision were absorbed into the new Criminal Law, and the crime of illegally selling special invoices for value-added tax (VAT) was listed as Article 207 of the Criminal Law, which has the basis of the Criminal Law Code and positively influences the application of the systematization thereof.Article 207 of the Criminal Law of 1997 stipulates that, "Anyone who illegally sells special invoices for value-added tax shall be sentenced to fixed-term imprisonment of not more than three years, criminal detention or control, and a fine of not less than 20,000 yuan but not more than 200,000 yuan; if the quantity is large, fixed-term imprisonment of not less than three years but not more than ten years, and a fine of not less than 50,000 yuan but not more than 500,000 yuan; if the quantity is huge, fixed-term imprisonment of not less than ten years or life imprisonment, and a fine of not less than 50,000 yuan but not more than 500,000 yuan or confiscation of property." It can be seen that when the 1997 Criminal Law incorporated the provisions of the 1995 Decision, there was no change in the formulation of the crime, i.e., the constituent elements, but certain adjustments were made to the sentencing: firstly, the sentence of "fixed-term imprisonment of not more than three years" was increased by the sentence of control, and secondly, the sentence of "fixed-term imprisonment of not less than ten years or life imprisonment" was increased by the sentence of "fixed-term imprisonment of not less than five hundred thousand yuan or life imprisonment for an enormous quantity". First, the penalty of control was added to the sentencing level of "fixed-term imprisonment of less than three years"; second, the penalty of fine was added to the level of "fixed-term imprisonment of more than ten years or life imprisonment". Since then, China's Criminal Law has been amended several times, but the content of article 207, which criminalizes the illegal sale of special invoices for value-added tax, has not undergone any further changes.

On March 20, 2024, the Supreme Law and the Supreme Prosecutor promulgated and implemented the Interpretation on Several Issues Concerning the Application of Laws in Handling Criminal Cases of Endangering Tax Collection and Administration (Legal Interpretation [2024] No. 4), which repealed the previous 1996 judicial interpretation.Article 15 of the 2024 Supreme Law and Supreme Prosecutor's judicial interpretation relating to taxes provides that "[w]here a person illegally sells a VAT invoice, he shall be convicted and sentenced in accordance with the the conviction and sentencing standards of Article 14 of this Interpretation (Note: i.e., the crime of counterfeiting invoices)." Other than this, there is no other special explanation of the constituent elements and the offense.

03 Elements of the crime of illegal sale of VAT invoices

Through the aforementioned combing of the legislative history and judicial interpretation of the crime of illegal sale of value-added tax invoices, it can be found that the crime and the elements of the crime have not undergone any changes, and only some changes and adjustments of the statutory penalties and sentencing standards have been made. In the author's opinion, since there is no change in the statutory offense of illegal sale of VAT invoices, the current judicial authorities should strictly follow the legislative purpose and intention of the legislature when applying this crime when the 1995 Decision was issued, and construct a constituent element system in line with the principle of statutory crime and punishment under the guidance of the specific legislative purpose and intention.

As Prof. Luo Xiang said in his article "The Interpretive Position of Criminal Law in the Age of Misdemeanors - Taking the Competition Theory as a Perspective" (in Comparative Law Studies, No. 4, 2024), "the principle of the law of crime and punishment requires the judiciary to follow the rules established in advance by the legislator and to respect the commitments made across time " and that "although the legislative intent is difficult to probe, the legislative language has relative clarity, and the interpreter of criminal law cannot arbitrarily break through the commitment made by the legislator through language and logic". The understanding and application of the crime of illegal sale of VAT invoices can likewise not violate the principle of the law of crime and punishment, and cannot arbitrarily break through the commitment made by the legislator across time through language and logic in the context of the legislation of the other time. By sorting out the past and present life of the crime in the preceding paragraphs, the constituent elements of the crime can be summarized as follows:

1, the subject of the crime: the staff of the tax authorities and outsiders, usually should form an accomplice, the two types of subjects both and collusion with each other.

2. Object of crime: blank VAT invoices, which should normally be in the form of costs and sets. If the sale is a fake invoice, it constitutes the crime of selling a forged VAT invoice but not this crime.

3. Criminal behavior: the staff of tax authorities use their position to facilitate the external personnel to take fraud and other unlawful means to obtain the cost, complete sets of blank VAT invoices and then resell them to the outside world for profit.

It should be noted that, since the crime of speculation before the 1995 Decision criminalized the acts of printing, selling and false invoicing as a whole, and the acts of counterfeiting, selling, buying and false invoicing were divided into four crimes after the 1995 Decision was issued, the crime of "illegally selling VAT invoices" should not be used for the evaluation of the acts involving false invoicing. Therefore, the crime of "illegal sale of VAT invoices" should no longer be used to evaluate acts involving false invoicing.

4. Infringement of legal interests: The crime of illegal sale of VAT special invoices infringes on the state's monopoly on the sale of invoices. It should be noted that illegal sale, illegal forgery and other behaviors do not directly lead to the loss of national tax, and the behavior that causes the loss of national tax can only be the behavior of false invoicing, therefore, the object of protection of this crime is not the national tax, but the national invoice management order, specifically, the state's monopoly on invoice issuance and sale. 1995 Decision divides the original crime of speculation into four, which follows the principle of different objects of protection of legal interests, i.e., the legal interests protected by "false invoicing crime" are national tax. The decision of 1995 to divide the original speculation crimes into four also follows the principle of different objects of protection of legal interests, i.e., the legal interests protected by the crime of "false invoicing" are the state tax money, the legal interests protected by the crime of "forgery" are the state's monopoly on printing invoices, and the legal interests protected by the crimes of "sale" and "purchase" are the state's monopoly on the sale of invoices. The "crime of sale" and the "crime of purchase" protect the legal interest of the State's monopoly on the sale of invoices.

Luo Qingdong, the current deputy director of the First Procuratorate of the Supreme People's Procuratorate, published an article in the People's Procuratorate Magazine, Issue No. 2, 1996, entitled "Powerful Weapons for Curbing the Crime of VAT Specialized Invoices - Learning from the Decision on Punishment of the Crime of False Issuance, Counterfeiting and Illegal Sale of VAT Specialized Invoices ". The article points out that "the crime of illegally selling VAT special invoices. According to the regulations, only the tax authorities have the right to issue VAT special invoices, and no other unit or individual has the right to sell them, and violators may constitute this crime." This judicial authority also strongly indicates that the legal interest protected by the crime of illegal sale of VAT invoices is the state's exclusive right to issue and sell invoices. Offering means issuing and selling, not just selling. The infringement of the legal interest of this crime on the franchise of offering also corresponds to the fact that the object of this crime is blank invoices.

The description of the legislative grounds for article 207 in the Explanation of the Provisions of the Criminal Law of the People's Republic of China, Legislative Reasons and Related Provisions of the Criminal Law of the People's Republic of China (2009 edition by Peking University Press) of the Criminal Law Office of the Legislative Affairs Commission of the Standing Committee of the National People's Congress is also able to corroborate the legal interests that this crime infringes upon and the objects of the crime summarized in the foregoing. The book mentions that the legislative reason for this crime is: "Special VAT invoices are issued by the state tax authorities in accordance with the regulations, and are limited to be purchased and used by general taxpayers of VAT. Other than that, no one and no organization can sell them, and special VAT invoices must be managed very strictly. Illegal sale of VAT special invoices not only undermines the state's management of VAT special invoices, but also contributes to the criminal activity of fraudulently issuing and cheating the state tax." As can be seen, the crime emphasizes the infringement of the state invoice management order and infringes on the state's invoice franchise, and the VAT invoices purchased from the tax authorities can only be blank invoices.

5. Subjective elements. The subjective aspect of this crime can only be intentional, and the perpetrator usually has the purpose of making profit. VAT invoices are not ordinary commodities and cannot be traded freely, and the state has strict regulations on the sale, management and use of VAT invoices, which are known or should be known by any person holding VAT invoices, and if the perpetrator still sells them illegally for profit, his criminal intent is obvious.

04 Extended application of the crime of illegal sale of VAT invoices should be curbed as soon as possible

At this point, the conclusion is self-evident. Since the criminal object of the crime of illegal sale of VAT special invoices is blank VAT special invoices, it is obvious that the practice of sentencing the false invoicing act of charging invoicing fees for profits to the crime of illegal sale of VAT special invoices is an erroneous application of the crime. Before 2000, VAT invoices were mainly handwritten versions until January 1, 2000, when the anti-counterfeit tax-control system for issuing VAT invoices was fully promoted and the invoicing became more standardized, and since July 1, 2003, with the implementation of anti-counterfeit tax-control system in place, the handwritten version of VAT invoices was withdrawn from the stage of history. Since the handwritten invoices have been quietly withdrawn from the market and there is no market for the sale of blank invoices, the crime of illegal sale of VAT invoices should be silenced, and the phenomenon of "resurgence" of this crime in the judicial practice nowadays is obviously an inappropriate enlargement of the application of this crime, and this trend should be curbed as soon as possible.

The tax-related judicial interpretations of the Supreme Law and the Supreme Prosecutor failed to effectively freeze the application of the crime, but instead triggered the discussion on the competition between the crime of false invoicing and the crime of illegally selling VAT invoices, which is the regret of the tax-related judicial interpretations of the Supreme Law and the Supreme Prosecutor. According to the second paragraph of Article 10 of the Supreme Law and the Supreme Prosecutor's Tax-related Judicial Interpretation, the subjective behavior of the perpetrator does not have the purpose of tax fraud and objectively does not cause fraudulent loss of tax, and will not be punished for the crime of false invoicing. What kind of crime does it constitute? The author believes that, without the purpose of tax fraud and fraudulent loss of tax fraudulent invoicing behavior can be sentenced to the crime of fraudulent invoicing, the maximum sentence of 7 years, there are similar jurisprudence in practice, the judiciary can boldly take this step.

It is necessary to draw special attention to the fact that the judicial organs must not define the act of false invoicing which does not constitute the crime of false invoicing as the act of illegal sale of invoices only for the convenience of evidence collection, which not only obviously deviates from the constitutive elements of the crime of illegal sale of special invoices for value-added tax but also obviously violates the principle of the compatibility of crime and responsibility with punishment. One cannot help but ask, is this not the spirit of the two high courts just following the spirit of limiting the circle of false invoicing crime, and then applying the new crime, but in reality, the parties concerned are subjected to the same and similar penalties, which results in the efforts of the two high courts to set up the provisions of the crime of false invoicing to come to null and void? Therefore, we call on the Supreme Court and the Supreme Prosecutor to solve the problem of confusion in the application of charges brought by the tax-related judicial interpretations of the Supreme Court and the Supreme Prosecutor as soon as possible, so as to stop the wrong trend of interpreting the act of false invoicing as the act of selling invoices and sentencing to the crime of illegally selling VAT invoices in practice.