On November 14, 2016, the SAT and the State Administration of Foreign Exchange (“SAFE”) signed a Memorandum on Cooperation for Promoting Information Sharing and Implementing Joint Supervision. 

The SAT and the SAFE will jointly establish a routine information exchange system to share data on tax administration and foreign exchange supervision, focused on risk monitoring, assessment and warning, e.g., on export tax refunds, crossborder tax sources and foreign exchange receipts and payment. The two departments will also share information on enterprise classification to jointly implement incentive and penalty measures. 

The Memorandum confirms the two departments’ resolution to combat tax refund fraud, protect China’s tax sources and prevent illegal foreign exchange transfer. 

Date of signature: November 14, 2016