Chinese actress Fan Bingbing, who had been missing from the public eye for nearly three months, has been fined nearly U.S.$130 million for tax evasion, and posted a statement of "remorse" to social media.
Fan was forced to pay some U.S.$ 70 million in unpaid taxes, and around U.S.$60 million in tax arrears, but will escape criminal prosecution if she pays the amount in full, state news agency Xinhua reported.
The X-Men: Days of Future Past star admitted to signing fraudulent contracts, known as "yin and yang" contracts, one of which contains the figure reported to the taxman, and the other of which states the actual amount paid, media reports indicated.
Xinhua said that her agent, identified only by his surname Mou, remains under investigation.
During the investigation, Mou "obstructed the process by instigating employees to hide and deliberately destroy accounting materials of the companies involved," Xinhua reported.
Her agent and "other related personnel" are under "compulsory measures," it said.
The State Taxation Administration has also ordered its Jiangsu Provincial Tax Service to punish taxation officers in connection with the evasion, the agency said.
Fan said via her account on the Sina Weibo social media platform that she had endured "a lot of unprecedented suffering" since her disappearance.
"I have been through a deep process of reflection, and I feel the deepest remorse and regret for my actions," she wrote. "As a public figure, I should set an example in abiding by the law, and not lose track of my moral compass for financial gain, to the extent of getting on the wrong side of the law."
Fan's name was recently removed from the poster of the movie Unbreakable Spirit, starring Bruce Willis, during her disappearance, the Global Times newspaper reported.
Repeated calls to the State Administration of Tax Affairs and the tax bureau of the provincial government in Fan's home province of Jiangsu rang unanswered on Wednesday, which fell during the Golden Week holiday period beginning Oct. 1.
Tax avoidance common
Tax authorities have told the film and TV industry that anyone undergoing self-assessment resulting in remedial payments to taxation before Dec. 31 will be exempt from administrative punishment and penalties.
Chinese cultural commentator Yin Hong said that tax evasion and avoidance is common among high-earning individuals in China, but that the targeting of Fan suggests that a wider crackdown on the entertainment industry may be in the offing.
"The authorities will definitely be stepping up surveillance after this, which will be a huge blow to the investment structure and sentiment across the whole entertainment industry," Yin told RFA.
"It looks as if the entire entertainment industry is going to go through a very painful rectification process," he said.
Zhang Zanning, a former law professor at China's Dongnan University who was fired over "sensitive and outspoken speech" on social media, said the authorities were playing fast and loose with the rule of law by absolving Fan of any criminal responsibility.
"They shouldn't be allowed to do that," Zhang said. "If she has committed a crime, then they should pursue her in a criminal court, not just absolve her of criminal responsibility because she paid a fine."
"Such things shouldn't exist in a society ruled by law," he said.
Warning to the industry
Meanwhile, current affairs commentator Jin Zhongbing said the authorities were likely making an example of Fan to send out a warning to the rest of the industry.
"Is this really about Fan Bingbing?" Jin said. "It definitely has something to do with her, but also, they want to use a celebrity like her to have an impact, and to shock other stars like Fan Bingbing and the entertainment companies, so it has multiple applications."
"Naturally, a deal was cut behind closed doors and compromises were made, for her to avoid criminal responsibility for what was a massive amount of tax evasion," he said.
"They clearly gave her a number of options, and of course she picked the one that was the least harmful for her."
In 2011, outspoken celebrity artist Ai Weiwei was detained and held in a secret location for 81 days, prompting an international outcry. His company was later hit with a U.S. $2.4 million "tax evasion" fine.
Reported by Wong Lok-to for RFA's Cantonese Service, and by Gao Feng for the Cantonese Service. Translated and edited by Luisetta Mudie.