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Tax fraud revealed
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ZHANG GUIXI, former CEO of the Guiguang Group, a Chaoyang-based enterprise, was recently arrested for allegedly swindling a fortune in export taxes. He was also revoked the qualification as NPC deputy and deputy to the Chaoyang Municipal People's Congress, the Xinhua News Agency reported on Monday.
From November 1999 to June 2000, he wrote some 780 million yuan (US$93.2 million) worth of value-added tax invoices for illicit use, the report said.
The uncovering of the case has sent shockwaves among local people and officials. Many officials in the city held the opinion that the case is alarming and lessons should be drawn from it.
The Guiguang Group was once a top enterprise in the city of Chaoyang. At one time, it was even honoured as a “township enterprise with the best economic earnings in the country". Zhang himself was elected as the deputy to the National People's Congress in 1998.
Zhang's fellow townspeople told the reporters that Zhang was down-to-earth and hardworking when he started his clothes-making factory in 1989; earnings of the factory were good.
Unfortunately, Zhang later focused his attention on weaving a network of relations. In order to expand this network, he never hesitated to bribe local officials with large amounts of money, behaviour which was an open secret in Chaoyang City.
“As a matter of fact only the Guiguang Clothes-Making Factory belongs to Zhang Guixi. Other enterprises under the Guiguang Group are owned by others, some of whom are his relatives, but nobody knows how he managed to register all these enterprises to form the Guiguang Group," an official with the Gurao Township thus revealed.
Few could have expected to see the once well-known “Model Worker" arrested by the police and faced with the possibility of imprisonment for tax fraud, the official said. Lessons should be drawn from this case, he concluded.
Loopholes in the legal system, lack of legal awareness and lax supervision are cited by the Xinhua News Agency as three of the main reasons for Zhang's having gotten away with his misdeeds for as long as he did.(Alfred Zhang)
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