Fan Bingbing
Actor Fan Bingbing poses on the red carpet at the 53rd Golden Horse Awards in Taipei, Taiwan.Reuters

X-Men actress Fan Bingbing has been asked to pay approximately $130 million in fine for tax evasion and other offences. Xinhua, a media outlet based in China, reported that the missing actress owes more than 883 million yuan to the Chinese government.

Fan is one of the highest paid actresses in China. She has been missing for the past three months after her tax evasion scandal became public. The actress sent out a lengthy statement soon after and wrote, "I failed my country which nurtured me; I failed the society which trusted me; I failed the fans who liked me."

"I totally accepted all of them, and will raise funds to pay my taxes and penalties regardless of any obstacles," she wrote.

The incident came to light in June when a TV host leaked all the documents that pointed out how the A-list actress embezzled money. The documents showed that Fan was practising an illegal way of paying tax, known as the yin-yang contracts.

Basically, it means production companies would have two different contracts ready. One in which a small amount of the salary would be listed for tax purposes and in the other contract, a larger amount which is the actual pay for the actor.

The documents allegedly stated that Fan's first contract showed that she made $1.56 million in four days for a film and the second contract showed that she actually made $7.8 million.

The report by Xinhua stated, "In June after people reported Fan Bingbing's "yin-yang contract" related to tax issues, the State Administration of Taxation attached great importance to the case and was obliged to instruct the tax authorities in Jiangsu and other places to comply with the law. Investigations were carried out to verify that the facts of the current case have been ascertained." 

The report also contained a warning statement to the Chinese entertainment industry to stop the yin-yang contracts. "Film and television enterprises and related employees who have self-examined and rectified themselves before Dec. 31, 2018 and paid owed taxes to the relevant authorities shall be exempted from administrative punishment and shall not be fined," it says. But those who "seriously evade taxes and fail to perform their duties according to law will be held accountable and pursued legal responsibility."