On 8 October 2026, the Ministry of Finance clarified procedures under the Compulsory Enforcement Act and the Tax Collection Act allowing taxpayers whose assets have been provisionally seized (假扣押) by tax authorities to secure release by providing collateral equivalent to the outstanding tax liability. This administrative interpretation addresses Article 33 of the Tax Collection Act and Article 517 of the Code of Civil Procedure, providing a mechanism for businesses to maintain operational continuity while tax disputes are adjudicated. The collateral may include cash deposits, bank guarantees, real estate liens, or negotiable securities acceptable to the National Taxation Bureau.
Key Takeaways
- Collateral Substitution Right: Taxpayers can apply for release of seized bank accounts, receivables, or inventory by posting security equal to 100% of the assessed tax debt plus estimated penalties and interest.
- Expedited Processing: The National Taxation Bureau must rule on collateral adequacy within 10 business days of application, reducing asset freeze duration from months to weeks.
- Preservation of Appeals: Providing collateral does not constitute waiver of the right to administrative appeal or administrative litigation regarding the underlying tax assessment.
Disclaimer: This article is compiled and summarized by the AI based on publicly available information and is for general information purposes only. It does not constitute any form of formal tax advice, legal opinion, or basis for performance. Please consult a qualified professional tax advisor or legal counsel for tax advice.
Source: Read Official Announcement