The Zhejiang provincial office of the State Administration of Taxation recently triggered public outrage by purchasing a yacht reportedly worth 2.71 million yuan ($423,576).
Pictures showing the launch of the vessel were posted by a Chinese whistle-blower on his Sina Weibo page on September 22, raising questions among Internet users about whether it was appropriate for the office to spend government funds on such a luxury.
The Zhejiang government later responded on its official website by saying that the yacht would be used for tax collection by the Chun'an county tax bureau, and that the vessel had been purchased for a modest price – none of which managed to quiet the public uproar.
Disbelief
The vessel named "Guo Rui," which means "the country becomes prosperous," was justified by local tax officials as an essential tool for their work. They claimed that the bureau needed the yacht because many local businesses operate on Thousand Island Lake, or Qiangdaohu, which requires a boat for access.
According to Fang Yongjun, a tax official at the bureau, the double-decker yacht – which represents a marked upgrade from the tax bureau's previous vessel – has been converted into a tax collection office, with the first deck being a work area and the upper deck a waiting room for taxpayers.
But web users were hardly convinced. "According to this logic, we should buy helicopters for tax officials whose districts include mountains or forests," said one Weibo user.
For people familiar with the Thousand Island Lake area, the excuses made by the tax bureau seemed ridiculous, and many doubted that the boat would be used as a floating "office。"
"I often go to the area to travel or play golf, and know the place quite well," said another Weibo user. "Chun'an county has several towns and all of them can be reached by road."
"Even if they really needed to collect taxes by ship, why buy such a luxurious yacht instead of a common vessel? There are only several hundred taxpayers there. In order to pay for the yacht, how many years of collecting their taxes will be enough?" asked another web user.
Unsatisfactory results
The outcry was the latest example of how China's social networking sites are subjecting Chinese officials to unprecedented levels of scrutiny.
Last December, the finance bureau of Fushun city, Liaoning Province, reportedly bought iPod 4s for its employees as USB flash disks, which raised questions about government spending.
In addition, government bureaus in Taizhou, Jiangsu Province, Yiwu, Zhejiang Province and Ningxia came under fire after spending large amounts of money on luxurious cars.
"No wonder the country's tax revenue is never enough to cover spending," one web user said.
Although scrutiny has grown this year following appeals for more transparent government expenditure, 95 central government departments have failed to provide satisfactory information to the public.
Among these departments, only the auditing bureau published the required details of expenditures on cars, foreign trips and receptions. Other departments claimed overall amounts, but did not provide itemized lists of expenditures.
Losing public trust
Since the tax burden on people has increased, many are keeping a sharp eye out for suspicious purchases by government departments.
Before the tax reform of 1994, the proportion of expenses on tax collection out of the total tax revenue was about 3.12 percent. That figure increased to 4.73 percent in 1996 and is now at 5 to 8 percent.
For many, the reason why taxes have gone up is that tax revenue is being spent on the wrong things, such as yachts and cars. If the revenue is used instead to solve social problems such as education, medical insurance and affordable housing – and the public is informed clearly – there will be no doubts about the increase.
To regain public trust, the government should invite independent auditors and supervisory departments to investigate whether government spending is being carried out properly, and promote a more transparent way to publish the spending of public funds.
