In may of this year China’s highest paid actress and household name, Fan Bingbing, was accused of tax evasion. After the accusation Fan suddenly disappeared from the public eye, only releasing an apology on China’s version of Twitter, Weibo. In her apology her admitted to her faults and begged the public for their support and forgiveness.
“Today I’m facing enormous fears and worries over the mistakes I made! I have failed the country, society’s support and trust, and the love of my devoted fans!….I beg for everyone’s forgiveness!”
That was all that had been heard of her since June until the 3rd of this month when Chinese Authorities announced that she would be fined nearly 884 yaun, which translates to 129 million U.S. dollars. Fan was investigated for the use of ‘Yin-Yang’ contracts, which in recent years have become prevalent among China’s highest earning stars in order to avoid tax laws and a recent policy that caps television and film stars earrings in order to discourage “money worship and distribution of values”. “Yin-Yang” contracts working in a way that had the actor signed to two contracts, the yang side representing the light, that shows lower earning to authorities, whereas yin the dark side, hides the larger sums of money that is to go unreported for. Chinese contract law legislation states multiple grounds where a contract can be deemed as void. Many contracts achieve their purpose of appearing legitimate but conceal illegal undersides. Fans contracts were rendered void as they fell under the violations: contracts that harm social and public interests and violation of provisions of laws and administrative regulations. The Judicial courts in china works on a case by case approach for the validity of every single yin yang contract, the system works in favor of contracts where the value is small. Fan was exposed for her work in Air Strike where she signed one contract for 10 million yuan when the yang contract had been signed for 50 million (avoiding 6.18 million yuan in personal income tax) , Fan studio however, refused the accusations, later withdrawing that statement and apologizing when it was too late and authorities had began full investigations.
Stars going missing after accusations from the government is not unheard of, or even uncommon. The goal is to set a high example for other through the punishment. “When actors become famous, they can profit from their appearances and even words they say. If you are famous and rich but do not take your social responsibilities to pay tax accordingly, it is wrong,” said Lin Yongjian, vice chairman of the China Television Artists Assn. Fan was rumored to be under house arrest, banned from overseas travel or even imprisoned, but no reports from the government is have shared
Fan Bingbing may not sound like a familiar name, but she starred in 2014 Hollywood blockbuster hit X-Men Days of the Future Past as Blink. She is also a public face for major brands like Louis Vuitton, Montblanc and De beers, but Montblanc is the only brand to account its severed connections, while other have stayed quiet.