The government is expected to wipe out illegal charges after a thorough investigation into all fares imposed on township enterprises that will be conducted in the first half of this year.

Approval for new charges will be suspended, unreasonable fees cancelled, charges lowered and repetitive fees merged, according to Hou Yunchun, secretary-general of the State Economic and Trade Commission.

All township enterprises will get a list of charges they are liable to pay so that there is no confusion.

Nearly 1 billion yuan (US$121 million) in unreasonable charges had already been removed from the financial burdens of such enterprises throughout the country by the end of last October, said Fan Xiaojian, vice-minister of agriculture.

A law on township enterprises, approved in 1996 and took effect in January 1997, bans illegal charges on township enterprises.

Fan, along with eight heads of departments under the State Council, made a report on how to strengthen the enforcement of the law to the Standing Committee of the National People's Congress (NPC) last month.

Township enterprises, a major force in the rural economy, chalked up profits of 272.4 billion yuan (US$32.8 billion) in the first half of last year, a jump of 14 percent over the same period in 1999, according to figures from the Ministry of Agriculture.

However, arbitrary charges, fines and irrational quotas imposed by local government departments on township enterprises have held back their development.

For every 100 yuan (US$12) in profits a township enterprise earns after paying tax, it has to pay 20 yuan (US$2.40) on a number of other charges, according to a survey conducted in five provinces by the State Economic and Trade Commission earlier last year.

Unreasonable charges on township enterprises totalled 110 billion yuan (US$13.3 billion) in 1999, accounting for 20 percent of their profits.

China had 20.71 million township enterprises in 1999, an increase of 3.3 percent from 1998.

The NPC Standing Committee sent out four inspection teams to eight provinces last May to make sure that the 1997 law was being enforced and the rights of township enterprises protected.

Senior officials also agreed on the necessity of establishing a development fund for township enterprises, but they have not yet sorted out a practical way of starting it.

(China Daily 01/11/2001)