BEIJING, June 5: More than 1,000 foreign companies have decided to challenge the Chinese authorities over a new tax many believe is being used to fund Beijing's bid for the 2000 Olympics, business executives said here, reports AFP.
The companies are also considering writing to International Olympic Committee (IOC) President Juan Antonio Samaranch to express their concern over the tax. which took effect on May 1 with little advance notice.
The Impending showdown could be highly embarrassing for Beijing, which is a leading contender for the Olympic bld along with Sydney. The IOC is to choose a site for the 2000 summer games in less than four months.
The Beijing city government spokesman, Dign Weljun, rejected that the tax was linked to the Olympic bld. saying that all receipts would go to improving education in Beijing, not construction projects as widely believed.
Tt has no connection with the Olympic bid, "Ding told AFP." You can say that we are going all out In our bid, but you can't say everything Is related. That is a complete misunder- standing.
The tax, officially for "social utilities" but referred to by many foreign businesses here as the "Olympic tax," introduced a two dollar a day surcharge for each apartment or office rented by foreign and Chinese firms.
Fines will be levied for late payment
A more detailed explanation of the tax would soon be released, the Beijing spokesman said, which would include a 40 to 50 per cent discount for foreigners residing in the Chinese capital for more than six months.
But even with the discount monthly expenses will increase by thousands of dollar's for some larger firms, which already pay rents on par with the world's most expensive capital cities.
Upset over not being consulted, executives from more than 1.000 joint ventures and representative offices, the vast majority of those registered here, have banded together and plan to deliver a protest letter to’ the Beijing city authorities immediately.
The letter will request the tax be eliminated for all foreign residents.