China Will Tax Donations

The streamers were confiscated by Chinese authorities. Streaming platforms are required to report their live broadcasts twice a year, including information such as personal user IDs, bank accounts, and income, under new regulations issued by the China Cyberspace Administration, the State Administration of Taxation, and the State Administration for Market Regulation. 

Furthermore, platforms must deduct personal income tax from the earnings of persons who participate in live broadcasts. Simply simply, China levies a tax on donations because they are the source of revenue for streamers. This also includes all product sales made during streaming. 

Exaggerated or misleading marketing methods are also prohibited in live broadcasts under the new guidelines. According to the source, a lot of broadcasters claim to avoid paying taxes on a regular basis. Previously, the state had little authority over this field of business, which meant that everyone made their own decisions about how to pay taxes. Everything is about to change. 

Streaming platforms are allegedly anticipating a drop in this area as a result of the uncertainties around new tax policies. Tax limitations harmed Tencent Music Entertainment’s first-quarter performance, according to the company. Social entertainment accounted for roughly two-thirds of the company’s revenue last year. 

Tencent, on the other hand, feels that industry regulation would help it expand in a healthy and steady manner.