Futurism

China to Start Using Blockchain to Collect Taxes and Send Invoices

In Brief


China has just announced that it will use blockchain technology for social taxation and issuing electronic invoices. This is just the latest example of the broad array of applications possible for the technology.

Blockchain In China

The Chinese government listed blockchain in its “Thirteenth Five-Year” National Informatization Plan from 2015, and since that time the nation has been working diligently toward incorporate the technology into daily life. The tech’s inclusion in the plan signals the importance China has attached to it, and this was just confirmed by the government’s announcement that it “will utilize blockchain technology for social taxation and electronic invoice issuance matters.”

Image Credit: OpenClipart-Vectors/Pixabay
Image Credit: OpenClipart-Vectors / Pixabay

This is a major development, and given that the Chinese economy is the world’s largest, with a 2016 GDP of over RMB 70 trillion (approximately U.S. $10.4 trillion), this should be an interesting test case for the implementation of blockchain technology. China has already launched a test of its own cryptocurrency based on the technology, so these initiatives should be able to build on each other.

Furthermore, we should also see implementation at the city level in China, as several local and provincial governments have recently promulgated pro-blockchain policies. In fact, a smart cities initiative has already enticed a Chinese automaker to integrate the tech into its business model. Additionally, blockchain-based industrial parks have gone up in Chengdu, Hangzhou, and other major cities, and agencies at different levels of government have created blockchain R&D teams.

Blockchain Technology Applications

This latest development in China is a good example of how blockchain technology can be used in a broad array of applications. Blockchain tech has been proposed for use in elections do to its potential for both transparency and security. It’s these features that make it appealing for taxation as well.

Governments aren’t the only ones exploring the tech’s applications. Walmart has started experimenting with a blockchain database that would protect consumers from contaminated food products as well as guard against product waste. Toyota is using blockchain to get its self-driving cars on the road faster, and the company plans to give customers access to their own data the same way.

Moving forward, we will see more and more innovative uses of blockchain technology as its potential is more fully realized. Transparency and security are both absolute essentials in a digital age, and China appears to be recognizing that need and putting this powerful tech to use through policy.

Disclosure: Several members of the Futurism team, including the editors of this piece, are personal investors in cryptocurrency markets. Their personal investment perspectives have no impact on editorial content.

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