China's tax collectors lead splurge league
By Olivia Chung

HONG KONG - The job of tax authorities is to collect money - not spend it - a point Chinese tax collectors, whose "offices" now include a rather fancy yacht, appear to have missed.

The State Administration of Taxation (SAT) heads all other government departments in lavishing money on overseas trips, official vehicles and receptions (collectively known as san gong), blowing away 2.17 billion yuan (US$340.4 million) last year, according to the annual expenditure details of 98 (out of 108 in total) central government agencies) released as of the end of August.

Revelations of the 32-meter yacht have in particular roused public hostility, pictures of its large lounge with armchairs, tables and panoramic windows on full public display on the Internet. Officials at SAT's provincial office in eastern Zhejiang have confirmed they spent the nearly 3 million yuan of public money on the vessel, with local tax official Fang Yongjun saying on a website that it was used for tax collection on Thousand Island Lake, a national tourist area.

The SAT has long been criticized for its lavish spending on overseas trips, official vehicles and receptions, an area of increasing public demand for transparency. In March, the State Council, or cabinet, ordered central government agencies to release their expenditure details relating to the three elements of public spending.

Zhejiang SAT spokesman Jin Wei told Asia Times Online the yacht was bought to replace an old vessel (above) in Chun'an county and stressed the yacht was bought strictly according to regulations.

Local citizens are skeptical. "Do [the Zhejiang tax office] need a helicopter for tax collection in the mountains?" asked one Internet user. Others questioned the need for an expensive yacht (below) for tax collection in an area where most people are fishermen and the per capita gross domestic product was 22,858 yuan, the lowest of 13 districts and counties in the provincial capital of Hangzhou, according to the county's website.


Eddy Li Sau-hung, vice president of the Chinese Manufacturers' Association and president of the Hong Kong Economic and Trade Association, speaking in Hong Kong, called for the government to appoint independent auditors to investigate whether buying the yacht was legal.

Trailing the tax collectors, other top spenders include the General Administration of Customs (503 million yuan), the General Administration of Quality Supervision, Inspection and Quarantine (419 million yuan), the Chinese Academy of Sciences (287 million yuan) and the China Banking Regulatory Commission and its branches (283 million yuan).

At the other end of the scale, the State Bureau for Letters and Calls, the country's top complaints hearing office, spent 982,500 yuan on the three items last year, followed by the State Council Leading Group Office of Poverty Alleviation and Development, a department responsible for alleviating poverty in rural China, with 1.45 million yuan.

Zhu Lijia, a public administration expert at the Chinese Academy of Governance, told Asia Time Online that even with the increased transparency, public doubt remained over the accuracy of the published data.

"Some government agencies are releasing their budgets for last year and this year, some are giving the total sum without any details for only this year. What really matters is not general numbers of such expenses, but detailed accounts such as the specific purchase paid for by taxpayers' money," he said.

Taking the Ministry of Science and Technology as an example, Zhu said it released a budget showing it would spend 40 million yuan on government cars, reception and travel in 2011, but it also said it was receiving 23.7 billion yuan this year from the central government. "The 40 million yuan the ministry earmarked for san gong accounts for less than 0.2% of the total it received from the central government, so much lower than the expected estimate that it gives rise to public suspicion," he said.

Zhu estimated that total san gong spending this year would be about 1 trillion yuan, or 30% of total government expenditure.

Spending on overseas trips reached 300 billion yuan just over 10 years ago, based on the China Statistical Yearbook 2000. Given the increasing trend of training courses and overseas learning and foreign trips offered by government departments since then, total san gong expenses should have reached 900 billion yuan a year in recent years, said Zhu. But the Ministry of Finance rejected Zhu's estimates, saying the total san gong spending was about 121 billion yuan a year.

Zhu called for government departments to reduce foreign trips and cut down on holding international conferences. "Although there is no official figure for the money spent on holding international conferences, I'm sure it's not a small amount," he said. "With advanced computers, better Internet access and more advanced devices, people have easier access to any information. I do not see there's any real meaning in overseas trips by government officials at public expense."

Of the SAT's 2.17 billion yuan san gong spending, about 665.87 million yuan went on negotiations and international conferences abroad. It did not elaborate on the spending. The National Population and Family Planning Commission, which runs campaigns on the mainland's one-child policy, spent 9.27 million yuan on the three categories in 2010; about half of that, 4.7 million yuan, went on foreign trips.

Eddy Li in Hong Kong said the three areas of spending that constitute san gong were well-documented sources of official corruption that encourages widespread discontent and are detrimental to social stability.

Zhu and Li recommended that an independent party should investigate the spending information given by the central government agencies to give more credibility to the official data that is released.

Olivia Chung is a senior Asia Times Online reporter.