Official government representatives from Beijing, China have announced that the city will be implementing a new blockchain-based digital invoices system, starting with the decision to launch a pilot application for what it has named ‘blockchain standard invoices in Beijing’.
This statement was made by the Beijing Municipal Tax Service (a part of the State Taxation Administration), and boasts that this will result in reduced operating costs for tax-paying businesses. It is also claimed that this will lead to a greater security of ‘social resources’, and will generally “create a healthy and fair tax environment.
The concept of a 100% government-run distributed computing system powering the “issuance, storage, transmission, anti-counterfeiting, and security of data contained within electronic invoices… [with] complete traceability” is a far-cry from the pro-decentralization roots of blockchain.
The vision for the implementing an electronic and blockchain-based invoicing system in Beijing is set to include: “VAT special invoices, standard VAT invoices (including unified invoices) and electronic standard VAT invoices”.
Such invoices will comprise of both a 12 digit long invoice code and an eight digit invoice number (which is generated automatically, according to the official announcement). ‘Blockchain electronic standard invoices’ will introduces significant improvements to existing electronic solutions by taking advantage of such technologies as:
“Blockchain distributed ledgers, smart contracts, consensus mechanisms, encryption algorithms and other technologies to ensure the issuance, storage, transmission, anti-counterfeiting, and information security of electronic invoices.”Beijing Municipal Tax Service, State Taxation Administration (announcement)
This wouldn’t be the first instance in which the People’s Republic of China has been reported to have been involved with blockchain technology, and could even be seen to be supporting it publicly…
Back in early-November 2019: China introduced legislative developments as part of greater ongoing financial reforms, with the aim of creating definitions for the enforcement of regulatory security standards pertaining to blockchain technologies and associated digital currencies.
Prior to that, the country’s President Xi Jinping delivered a speech in which he gave vocal support of blockchain technology and called for wider integration and adoption nationwide. This resulted in a massive, temporary spike in Bitcoin and general cryptocurrency purchases from Chinese investors.
More recently, in January 2020, we reported on the listing of an application on the China Securities Regulatory Commission (CSRC) by a company named ‘Penghua Fund’ which was seeking approval for a proposed blockchain-based Exchange Traded Fund (ETF).
The Penghua ETF would be the first of its kind to take place inside the regulatory confines of PRC.