*ST Middle Velvet ((000982): The Decision Of The Administrator To Receive Tax Administrative Penalty.

Stock Code: 000982 securities short: *ST velvet notice number: 2019-78

Notice of Ningxia Bank of China Limited by Share Ltd manager on receipt of decision on tax administrative penalty

The manager of the company guarantees the authenticity, accuracy and completeness of the information disclosure, without false record, misleading statement or major omission.

In August 9, 2019, the Ningxia Bank of China Limited by Share Ltd (hereinafter referred to as "company" or "the company") received the decision of the first tax bureau of the Yinchuan Taxation Bureau of the State Administration of Taxation, the decision on tax treatment (2019 banks of silver tax 33073) and the decision on administrative penalties for Taxation (2019, 33045).

I. main contents of the decision on tax treatment

(1) illegal facts

The trial results of the criminal judgment of the intermediate people's court "(2016) ning 01 penalty No. 18", from 2012 to 2013, your unit signed 489 false export sales contracts with 11 companies, such as group Thai International Trade Co., Ltd., China digital mall limited, Derry textile (Hongkong) Co., Ltd., Hongkong Hongyuan Textile Co., Ltd., and did not provide funds and products. It only used the export qualification of your unit, false export business, provided false information through false collection of foreign currency, and declared export through the "bill of fare" and "distribution" under the condition of no export, and obtained the export duty declaration with the customs inspection certificate, and applied for refund to the tax authorities. According to Yinchuan, the Ningxia Hui Autonomous Region According to the interpretation of the Supreme People's Court on certain issues concerning the specific application of law in the trial of criminal cases of fraudulent export tax rebates (No. 2002, No. 30), the first article: "the false declaration of exports" stipulated in the 204th provision of the criminal law refers to the act of making the export facts of fictitious tax goods one of the following circumstances:

(1) forging or signing false sales contracts; (two) forging, altering or otherwise.

Illegal means obtain the export tax rebate documents and vouchers, such as the declaration of export goods, the verification account for export receipts, the special payment books for export goods, and so on. (three) false invoices, forgery, illegal purchase of special invoices for value-added tax or other invoices that can be used for export tax rebates; (four) his behavior of fabricating tax goods for export. According to the regulations, between 2012 and 2013, the total amount of false export goods exported to your company amounted to $119111708.59, and the export tax rebate was $120330654.53, including 55853690.36 yuan in 2012 (3025430.92 yuan in April, 7561235.60 yuan in May, 9943349.96 yuan in June, 4140100.40 yuan in July, 152742.30 yuan in 2101274.55, 2101274.55 yuan in 12312476.94 yuan, 12312476.94 yuan in 12312476.94 yuan, 12312476.94 yuan in yuan, and Yuan Yuan in Yuan).

(two) processing decisions

According to the sixty-sixth law of the People's Republic of China tax collection and administration law, "fraudulent export or other fraudulent means are used to defraud national export tax rebates. The tax authorities recover their tax rebates, and impose a fine of more than five times the amount of tax fraud. If a crime is constituted, they shall be investigated for criminal responsibility according to law." The provision of tax rebates is 120330654.53 yuan. According to the criminal judgment of the intermediate people's Court of Yinchuan, the Ningxia Hui Autonomous Region ((2016) ning 01 penalty No. 18): The court held that the defendant, Ma Sheng Guo, was directly responsible for the Limited by Share Ltd of the Ningxia silver cashmere industry. After paying taxes in the cashmere industry, the defendant, Lin Huibin, Wei Jinfeng, Liu Jinye and Zhang Wen Zhen, took the means of false export, and defrauded the national export tax refund of 12033.065453 yuan RMB. The money stolen from the Yinchuan people's Procuratorate was RMB 110 million 77 thousand and 400 yuan, and the cash of the defendant Lin Huibin and Wei Jinfeng was 22 thousand yuan, which was handed over to the state treasury by the hospital.

The rest of the performance is recovered or ordered to be returned to the five defendants. The result of the trial is that the 110 million 99 thousand and 400 yuan tax has been handed over to the state treasury by the court. It has no longer recovered the 110 million 99 thousand and 400 yuan tax department that has been put in storage, and the balance of 10231254.53 yuan has been recovered. Among them, 6208344.10 yuan in August 2013, 2139006.43 yuan in September and 1883904 yuan in December.

Within 15 days from the date of receipt of this decision, you must pay the above taxes and late fees to the Inland Revenue Department of the State Administration of Taxation, and adjust the relevant accounts according to the regulations. If the overdue payment is not paid, it will be enforced in accordance with the fortieth provision of the law of the People's Republic of China on tax collection and administration.

If you (unit) have disputes with our bureau on tax payment, you must pay taxes and late fees in accordance with the time limit of this decision, or provide the corresponding guarantee, and then you can apply for administrative reconsideration to the the Ningxia Hui Autonomous Region tax bureau of the State Administration of taxation within sixty days from the date of payment of the above funds or the corresponding guarantee.

Two, the main contents of the decision on tax administrative penalty.

(1) illegal facts

A brief description of the illegal facts in the tax decision.

(two) punishment decision

According to the notice issued by the State Administration of Taxation on the administration of value-added tax and consumption tax on export goods, the thirteenth sixth clauses of the 2012 (twenty-fourth announcement of the State Administration of Taxation):

"(six) the export enterprises and other units shall defraud the State export tax refund by false declaration of export or other fraudulent means. The competent tax authorities shall recover the tax rebated from them and impose a fine of more than one time or more than five times the amount of tax fraud; if the case constitutes a crime, they shall be investigated for criminal responsibility according to law." And the sixty-sixth law of the People's Republic of China tax collection and Administration Law: "fraudulent export or other fraudulent means are used to defraud national export tax rebates. The tax authorities shall recover the tax rebates they defrauded, and impose a fine of more than one time or more than five times the amount of tax to be defrauded. If a crime is constituted, they shall be investigated for criminal offense according to law.

Responsibility. The tax authorities may stop exporting tax rebates for the export tax rebates within the prescribed period. In accordance with the regulations, the decision to export tax rebates to the State shall be punished by 1 times the amount of 120330654.53 yuan, or 120330654.53 yuan, in addition to the recovery of the tax rebated. The total amount payable is 120330654.53 yuan. Your unit will be paid to the tax bureau of Lingwu City, the State Administration of taxation within 15 days from the date of delivery of the decision. If the penalty is not paid at the time of maturity, our bureau may impose a fine of three percent per day on the basis of article fifty-first (1) of the administrative penalty law of the People's Republic of China.

If he refuses to accept this decision, he may apply for administrative reconsideration to the Inland Revenue Department of the State Administration of Taxation in accordance with the law within sixty days from the date of receipt of this decision, or, within six months from the date of receipt of this decision, bring a suit in a people's court according to law. If the penalty decision is not applied for reconsideration nor does it apply to the people's court for prosecution, or fails to perform, the Bureau will adopt the compulsory enforcement measures stipulated in the fortieth provision of the law of the People's Republic of China on tax collection and management, or apply for enforcement by the people's court.

Three. Other matters that should be explained, the impact on the company and corrective measures.

1, the people's court has already investigated the criminal responsibility of Ma Shengguo, the chairman of the company and general manager of the company and other main responsibilities personnel Lin Huibin.

2, the above tax related cases have a corresponding impact on the company's financial data for the year 2012-2013. The company has corrected the previous accounting errors according to the relevant provisions of the accounting standards for enterprises twenty-eighth, accounting policies, accounting estimates, changes and corrections, and regulations on the disclosure of financial information, No. nineteenth - financial information correction and related disclosures, and made retrospective adjustments to the consolidated financial statements of the affected periods. The details of the 2017-36 Ningxia cashmere industry share disclosed by the company in April 29, 2017 were specified in the information disclosure media.

The company's notice on corrections and retroactive adjustments in the previous accounting errors, as well as the resolutions of the board of directors disclosed on the same day, the board of supervisors resolution, the full text of the 2016 annual report, and the special statement on the error correction of the financial statements caused by tax related cases of controlling shareholders in the Limited by Share Ltd of Ningxia cashmere industry in the accounting firm's CPA firm. According to the above special instructions issued by Xin Yong Zhong accounting firm, as the audit institution of the annual report of 2012-2015, the company believes that the company's self check on the influence of the actual controller's tax related cases on the company's financial statements is basically reasonable, and there is no major error in correcting the amount of restatement.

3, after 2016, the company carried out a series of self-examination and rectification work, strengthened the management of branch and subsidiary companies, and improved the process of contract signing and Auditing: perfecting the capital payment approval system, ensuring the safety of company's funds payment: strictly controlling the process of invoicing, improving the internal financial reporting process control system, strengthening the process monitoring: strengthening the financial management of subsidiary companies, constantly strengthening internal control education and training, further improving the staff's awareness of internal control, continuously improving the internal control system, standardizing the implementation of internal control, standardizing the implementation of internal control, and strengthening the supervision and inspection of internal control.

4, as a result of the above tax related matters, the Shenzhen stock exchange gave disciplinary condemnation to the company and its interested parties in August 2017. Details of the announcement by the Limited by Share Ltd in August 30, 2017 on the 2017-92 decision of the Limited by Share Ltd of the Bank of China on the Shenzhen Stock Exchange's decision on disciplinary sanctions against the company and the relevant parties were disclosed.

The company's receipt of the decision on tax treatment and the decision on penalty decision does not touch on the serious delisting situation of major offenses stipulated in articles 13.2.1 (seven) to (nine) of the Stock Exchange Listing Rules of the Shenzhen stock exchange. There are no major illegal activities such as fraudulent issuance, serious disclosure of information or other serious damage to the order of the securities market. There is no serious impact on the listing status, and the stock should be terminated. There is no national security involved.

Illegal activities in public safety, ecological safety, production safety and public health and safety do not exist in a bad plot, which seriously damages the interests of the state and the public. Or seriously affect the listing status, and the stock should be terminated, and it will not touch on the situation of major illegal delisting, which is stipulated in the second, fourth and fifth provisions of the enforcement measures for mandatory delisting of listed companies.

The board of directors of the company is deeply sorry about the above tax matters, and will do its utmost to safeguard the company's rights and interests according to law. It will seriously comb and summarize the evidence materials collected and mastered in the above-mentioned tax matters, and if applicable, it will apply for administrative reconsideration to the the Ningxia Hui Autonomous Region tax bureau of the State Administration of taxation within the statutory time limit.

The company will strictly carry out the information disclosure work in strict accordance with the requirements and requirements of laws and regulations, and remind investors: the giant tide information network www.cninfo.com.cn and China Securities Daily, the Shanghai Securities Journal, the securities times, and the Securities Daily are the information disclosure media designated by the company. All the information of the company is based on the information published in the above designated media, so that the majority of investors should pay attention to risks.

Notice hereby.

Ningxia silver cashmere Limited by Share Ltd Manager

Two August 14th 19