Policy Snapshot

On 20 June 2025, the State Council issued Decree No. 810, the "Regulations on Tax-Related Information Reporting by Internet Platform Enterprises," supported by State Taxation Administration Announcements No. 15 and 16 of 2025. For the first time, "platform operators" must file quarterly returns disclosing the identity and income of all sellers and gig workers hosted on their platforms. 

• Effective date: Effective upon signing of the document, with the first reporting period being the third quarter of 2025 and the first filing to be completed by October 31.

• Scope of application: Covers domestic e-commerce platforms （such as Taobao and JD.com）, foreign platforms that generate profits in China （such as Twitch and Shopify）, and all online trading venues for profit, such as live streaming, short videos, and home delivery services.

Operator Obligations 

Basic Filing

Within 30 days of launch, file with the in-charge tax bureau: domain name, business category, unified social credit code, operating entity. 

Quarterly Detailed Return

Within one month after each quarter, electronically upload: 

• Seller/gig-worker identity (full name, ID number, place of registration)  

• Gross income originating from the platform and its classification (labor vs. business income)  

• Platform service fees (commissions, advertising, etc.)  

Upgraded Withholding

From 1 Oct 2025, the withholding formula for individual income tax on labor remuneration is reduced; platforms must also withhold VAT for any individual who's cumulative 12-month income exceeds the VAT small-scale taxpayer threshold. 

Verification & Safe Harbor

Operators must validate completeness and accuracy; a documented due-diligence defense exempts liability for seller-generated errors. 

Statutory Exemptions

• Individuals engaged in tax-exempt or preferential public-interest services (delivery, transport, housekeeping).  

• Income earned before 13 Jun 2025.  

• Data already reported via other withholding or government data-sharing channels.  

Non-Compliance implications 

• Minor violations: fines ranging from 20,000 to 100,000 yuan;  

• Serious violations: fines ranging from 100,000 to 500,000 yuan, and suspension of platform operations.  

Extra Cross-Border Hurdles 

Extraterritorial Reach

If the net quarterly consumption of consumers in China reaches 5,000 yuan or more, the income of overseas sellers must be disclosed, and the platform must track buyer consumption in real time.

Data Export

Personal data reported to Chinese tax authorities may trigger GDPR/CCPA constraints. Privacy policies must embed a clause on "cross-border data transfer for Chinese tax compliance," and jurisdictions must evaluate data-localization and encryption requirements. 

Industry Impact & Countermeasures

• Tech Stack: Large platforms have 90 days to complete API integration, data cleansing, and merchant onboarding; smaller players may outsource Compliance-as-a-Service.  

• Merchant Relations: Platforms are rolling out "Tax Health Scores"; merchants refusing to supply identity data face ranking penalties or delisting, raising entry barriers.  

• Capital Markets: Several US-listed Chinese e-commerce firms have added "tax information reporting risk" as a 20-F risk factor, warning investors of possible fines and compliance costs.  

Global Perspective

China's quarterly cadence exceeds the OECD Model Rules' annual standard, aligning with EU DAC7, UK DOTAS, and Australia's TPRS to form a global transparency lattice for digital platforms. 

Action Checklist

1. Inventory all revenue-generating users and tag them "taxable / exempt."  

2. Upgrade KYC modules to integrate Ministry of Public Security and SAMR identity APIs.  

3. Insert a "cooperate with tax reporting" clause in merchant agreements to forestall future disputes.  

4. Stand up a cross-border data-compliance task force to assess data localization, encryption, and outbound-transfer pathways. 

Conclusion

Decree No. 810 is more than a tax upgrade, it is the cornerstone of China's Platform Governance 3.0.

The competitive edge will shift from "traffic premium" to "compliance premium": whoever operationalizes the new regime fastest secures regulatory trust and capital favor.

At PHC Advisory, we can offer you full support on matters regarding doing business in China, or any other issues your business may face. If you would like to know more about policies relevant to your business in Italy or Asia, please contact us at info@phcadvisory.com.  

PHC Advisory is a company of  DP Group: an international professional services conglomerate of companies with approximately 100 experienced professionals worldwide. We offer comprehensive services in tax, accounting, and financial consulting, including financial supervision, financial audit, internal audit, internal control over financial reporting, and support for audited financial statements and annual audits, ensuring clients' financial transparency and compliance. 

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The content of this article is provided for informational purposes only, financial advice must be tailored to the specific circumstances on a case-by-case basis, and the contents of this article do not legally bind PHC Advisory with the reader in any way. 

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