WeChat has deployed a blockchain electronic invoice system in a restaurant at Shenzen. Following this development, the city of Shenzhen has become the first in China to issue invoices with blockchain technology. Tencent and The Shenzhen Municipal Office of the State Administration of Taxation have collaborated together to develop the invoicing system.
Tencent is first testing the new app for WeChat employees who have to use WeChat Pay service for paying the bills. This system was developed to simplify the process of reimbursing company employee expenses. Earlier, the invoicing process was quite cumbersome and elongated. The new dapp ensures removal of unnecessary delays during invoicing. Pilot tests are being carried out for testing the new dapp for corporate refunds. Companies which are taking part in the pilot include a restaurant, a parking lot, a goods trading company, and Tencent owned coffee shop.
For instance, after having a dinner, the company’s employee can pay via the WeChat payment platform. There is a real-time synchronization between the transaction data, the employer’s system, and the tax bureau. Because of the blockchain tech used, the information can’t be meddled with or lost. This, in turn, makes the process more comprehensible for all the stakeholders.
These days, China uses quite a complicated system in which shops and sellers provide different types of payment receipts for physical and legal entities. In order to receive compensation for their meals in restaurants, employees have to get a receipt for companies, where their company’s taxpayer number is printed.
Since the invoices are issued automatically using Wechat at checkout, the merchants are able to save time as well as personnel costs. The employer can easily track the transaction by tracking it on the blockchain. Moreover, it will also reduce the prevalence of false receipts. Also, the regulators can monitor the entire process of invoicing and reimbursement in real time. This, in turn, will ensure proper tax collection.
This is not the first blockchain-based electronic invoice system in China. In June, a system called “Tax Chain” was launched by the Huangpu district of the Guangzhou Development Zone with Guangzhou Gas Group. The Chinese government has been exploring other applications for blockchain including supervision of ex-prisoners, IP protection, and ID systems for public healthcare.
With the pace at which blockchain technology is disrupting various sectors, it would be pragmatic to assume that this new invoicing service will be used widely and will turn into the mainstream.