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Traditional paper invoices will be completely replaced by blockchain electronic invoices in Qianhai starting Jan. 1, 2020, according to Shenzhen Tax Service.

This is the latest innovative measure introduced by the city’s tax authority. In May 2018, the municipal taxation bureau established a smart taxation lab with Tencent to integrate the blockchain technology in tax services. The bureau also set up a team of 50-strong members from various departments for this end.

In August last year, the first domestic blockchain electronic invoice was issued by a restaurant in the International Trade Center Building in Luohu District, making Shenzhen the pioneer of blockchain taxation in the country.

The first domestic blockchain invoice in the field of rail traffic was issued March 18. The blockchain invoice has also been promoted at Wal-Mart stores in Shenzhen.

A consumer surnamed Zhang spoke highly of the blockchain invoice after shopping at a Wal-Mart store. “The whole process of invoicing can be completed on my mobile phone, and the list of the goods I’ve purchased is clearly displayed on the invoice. In addition, I can also have it printed out on site, which is really convenient,” she said.

As of yesterday, more than 9.75 million blockchain invoices worth 6.93 billion yuan (US$ 981.98 million) have been issued by 7,500 companies in Shenzhen, covering various aspects of people’s livelihood including catering, retail, transport and accommodation.

Repeated uses of paper invoices for reimbursement and fake invoices have been two major concerns for enterprises. Conventionally, an employee has to manually input the related information of an invoice when claiming reimbursement for expenses incurred during corporate activities and the information has to be manually verified by related personnel, which takes at least three minutes. With the introduction of the blockchain invoice, which is tamper-proof, traceable and credible, the authenticity and integrity of the invoice is guaranteed. Each link of invoice issuance can be inquired and verified.

The tax authorities can send out an online warning and conduct real-time monitoring and review by establishing a big data analysis model with the blockchain technology. Taxpayers can also receive information on the preferential tax policies related to them.

The introduction of blockchain invoices has significantly reduced the possibility of tax evasion and the cost of tax collection and management. Labor and material resources are also saved.

Starting Jan. 1, 2020, Qianhai will completely stop the supply of paper VAT invoices, which will be replaced by blockchain electronic invoices. Blockchain invoices will be supplied according to the actual business needs of enterprises.