As the capital of the "Bike Kingdom," Beijing is home to more than 10 million bikes, according to the Beijing Public Security Bureau.

The large number of two-wheeled vehicles alleviates Beijing's traffic jams, but creates many other problems for urban management and even social stability.

"Bike theft, bike tax evasion and illegal underground bike markets are some of the long-standing headaches facing Beijing," said a bureau official.

The bureau has recorded 2,661 cases of bike theft from late 1996 to early 2002.

The police have also smashed 261 bike theft gangs and arrested 1,220 people for bike-related crimes. In September last year, they collected 5,000 abandoned, shabby bikes in downtown Beijing in a single day.

The prosperous underground bike market makes life easier for bike pilferers, the bureau official said. Beijing does not have enough bike parking lots, forcing many cyclists to leave their bikes unattended and increasing the risk of theft.

There are also few second-hand bike markets in Beijing. Every year, hundreds of thousands of old bikes are abandoned because people have no place to resell them. About 3 million farm workers come to Beijing from other regions every year. They are the main buyers of old bikes. Some get them from the underground bike markets for less than 100 yuan (US$12) or steal them from the streets.

While Beijingers had to show their identity cards when registering their new bikes, migrant workers needed to present their temporary residency certificates issued by Beijing Public Security Bureau. To get such a certificate, they needed other certificates like a health card, identity card, family-plan card and references from their landlords.

So the easiest way to circumvent the red tape was to get a bike from the black market or stealing it.

Bike tax collection is also a big problem. With the increase in cyclists, the tax on bikes has dropped in the past few years.

"In 1995, tax was paid on 5.1 million bikes," said Chen Faguang, deputy director with the State Taxation Administration. "But the numbers for the following years were 4.98 million in 1996, 4.32 million in 1997, 3.76 million in 1998 and 3.16 million in 1999." That is only a third of the 10 million bikes in Beijing, according to Chen.

That means Beijing lost almost 30 million yuan (US$4 million) in taxes every year, based on the annual four-yuan (30 US cent) tax rate per bike.

"Many people do not want to spend half a day paying the four-yuan tax," Chen said. "Bike owners have to show their bike registration certificates again when paying the tax. But most of them have no certificate."

According to Beijing Daily, the city will set up more bike tax collection centers downtown to make it more convenient for owners to pay the fee. But collecting the tax is also expensive. Hundreds of thousands of taxation people work the streets in Beijing. And large campaigns are run every year to publicize the bike tax.

"Even if we collected taxes for all the 10 million bikes, the cost of collecting that money and the time spent by cyclists paying the fee would cost far more than 40 million yuan (US$4.8 million)," said Fan Gang, a Chinese economist. "It is time for our government to think about why it is collecting the bike tax if the cost is less than the return."

Beijing, Tianjin, Fujian and Inner Mongolia are the only places in China to impose a tax on bike owners.

(Beijing Weekend November 7, 2003)