Preparing A Digital Token: China To Use Blockchain For Social Taxation and Electronic Invoicing

Miaocai Network (miaocaiwang.com), a Chinese taxation system certified by the State Administration of Taxation to serve the citizens of China, announced the establishing of an Internet-based finance and taxation service platform and exchange. They are partnering with the “government affairs chain GACHAIN” to launch a GACHAIN-based tax electronic invoice and social tax-collecting service, utilizing Fintech linked to China’s “National economic data security system.”

A rough translation of the Chinese company website states:

“In the face of the impact of emerging technologies such as Fintech and block chains, the Group has actively explored the application of block chains in the fiscal and taxation business. After full contact and inspection, it has reached a strategic cooperation agreement with Shenzhen Zhanhe Technology Investment Co., Joint research and development based on the government chain of fiscal and taxation applications, which is the first international financial and taxation business actually landed in the block chain project, will further consolidate the network in China and the international industry in the leading edge.

Shenzhen chain of the Branch is a section of the international influence of the block chain company, with the top block chain development, business application floor team, with many domestic and foreign scientific research organizations, institutional departments to establish a wide range of cooperative relations Developed a government (GACHAIN) block chain platform.

Sight the financial network will use its own advantages, together with the Shenzhen chain together, the social tax collection, electronic invoices and other core business tax integration into the government chain, the use of government chain can be regulated, traceable, easy to transfer bills, tamper , High concurrent, and external interfaces and other advantages, without increasing the cost of transformation of the various departments under the premise of the source from the electronic invoice to start, until the end of the flow, corporate customers in the simplified process, easy to use at the same time, Process, and the tax authorities can also immediately monitor the origin of each electronic invoice, the public can check the authenticity of each bill, so that the entire tax bill business is simple, convenient and transparent, Good inhibitory effect.

From the creation of the initial, that is, with the discovery of trends, foresee the prospective strategic vision of the future, not only from the technology and services for our customers to provide quality products, but also efforts in the field of taxation on national security, tax reform and other aspects of society responsibility. Through cooperation with the government chain, the network is expected to bring the subordinate chain of financial and taxation applications will bring disruptive changes to the industry, but also on the state taxation rectification work has brought a strong boost.

At the same time, we will use the chain-chain technology to provide the public with an open, fair and just way to the public through the network contract of the original fiscal and taxation entrepreneurs and the financial and taxation service providers’ Transparent trading market,” they wrote.

“China’s tax collecting procedures feature slow tax reporting times and insufficient coordination. By making use of the unrivaled advantages of blockchain technology, together with the GACHAIN team, we are integrating core finance and tax business (such as social tax collection and electronic invoices) into GACHAIN, and by taking advantage of GACHAIN’s ability to regulate, trace back, and circulate documents easily, prevent falsification, high rate of concurrency, and external interface benefits, we can cover the entire process workflow from electronic invoice generation through the end of the process without increasing costs for those involved. Our corporate clients, while enjoying the benefits of streamlined processes and ease of use, simultaneously go through the tax reporting process, and taxation authorities can monitor the route of every electronic invoice in real time. The public can also check the validity of every document, thus simplifying the entire business process, increasing convenience and transparency, and putting a curb on invoice-related problems,” ChainHold CEO Lin Wan told Coinfox.

Wan further stated:

“The difference between GACHAIN and existing blockchains lies in its unique algorithm of Smart Law, which migrates existing policies, laws, and regulations to GACHAIN and has a hierarchy of administration. All smart contracts are administered within the framework of Smart Law and developed separately in accordance with the needs of government bodies. The business of the government bodies is handled separately as part of an integrated organism. It’s safe to say that GACHAIN is a sovereign blockchain that puts the decision making and regulatory rights into the hands of the government, meanwhile enabling every citizen to control his digital assets in GACHAIN. This will facilitate Chinese government control over blockchain projects and ICO.”

“Existing blockchain projects are disconnected from reality, and how to link the blockchain network to reality is an issue for deep consideration. I think that the key is to have government bodies acknowledge what’s in the blockchain, such as copyright ownership, the attributes of business organs, and property transactions, but with the prerequisite that they must conform to laws and regulations. When these two points are fulfilled, the blockchain and real world can be linked seamlessly. GACHAIN is designed and developed with this concept in mind. In other words, GACHAIN is – Blockchainn as Government Affairs. But meanwhile, GACHAIN has the attributes of decentralization, where smart contracts can be compiled, and one can protect his digital assets from being stolen by any organization of power and issue ICO. Of course, ICO must be approved by the regulatory body in GACHAIN.”

The design of GACHAIN effectively links the Chinese government with the blockchain.

Over the years, the Chinese government has attached great importance to the emerging blockchain industry and listed it in the “Thirteenth Five-Year” National Informatization Plan.

In June, China and Russia held their 7th Financial Ministerial Dialogue in Shanghai striking a $11 billion dollar funding deal.

Additionally, while at the meeting, Russia’s development bank VEB signed an agreement to attract 6 billion yuan or ($882.35 million) from China’s Development Bank for innovations, including the development of blockchain technologies.

Already we are starting to see prospects that China is headed towards preparing for the release of its own digital token, even seeing earlier last year a Chinese automaker Wanxiang’s invest $30 billion into a smart cities initiative in Hangzhou using blockchain technology, Coindesk reported.

While another U.S. and Japanese auto manufacturer, Toyota, is planning to use blockchain to amass “driving data that will help develop driverless cars,” Chris Ballinger, chief officer of Strategic Innovation at Toyota, said in a statement.

China also announced last year with the blessing of the IMF that it was “ready to release a digital asset,” which Christine Lagarde added that “virtual currencies are extremely beneficial.”

Shortly after the Shanghai meeting with Russia, China’s Central Bank – People’s Bank of China – tested a national Chinese digital currency.

If implemented it would be introduced alongside China’s primary currency the Renminbi (Yuan)China simulated possible economic scenarios and ran mock transactions using the cryptocurrency with some of its commercial banks.

The Chinese economy is the second largest GDP in the world at $11 trillion, only being beaten by the U.S. at $18 trillion GDP according to World Bank figures.

A new study conducted by PWC predicts that China will overtake the U.S. as world’s largest economy before 2030 due to continued technology-driven productivity improvements like investing into the blockchain.

The months and long-term years ahead for cryptocurrency will be historic and very interesting indeed as China seems interested in blockchain technology and sees it as a solution – do you?

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