Members of a piano smuggling ring thought to have evaded some 10
million yuan (US$1.3 million) worth of taxes appeared before the
Shanghai No 1 Intermediate People's Court yesterday.
It was the first day of testimony in a case that has sent
ripples through the local musical instrument industry, which has
suffered at the hands of smuggling gangs.
The story started last spring, when Shanghai Customs seized
eight smuggled pianos and traced them to 11 companies and 12
individuals.
In the ensuing raid, police discovered a cache of nearly 5,000
unsold pianos. The smugglers allegedly made tens of millions of
yuan selling contraband instruments.
Customs officials said the smugglers had probably managed to
dodge some 10 million yuan worth of taxes and seriously disrupted
the piano market in Shanghai.
Sun Changjian, a representative of Shanghai Piano Co, said the
city led the country in terms of demand for pianos and that
interest in pianos was growing as the local economy continued to
boom.
But despite these rosy prospects, Sun said his company's sales
had remained fairly static. He added that other piano dealers were
facing a similar situation.
The city's piano dealers noticed that secondhand pianos from
abroad had been dominating the market. In 2004, they accounted for
52.27 percent of all of the pianos imported in to Shanghai, and the
figure went up to 73.95 percent in 2005.
Most of those pianos had declared values of between US$200 and
US$250, leading Customs to suspect that the whole industry was in
collusion with smugglers. The suspicions proved to be
reasonable.
Investigators found that smugglers had been working with
overseas sellers to fake the declared prices of imported
instruments so they could avoid paying taxes.
The smugglers then sold the pianos to local instrument stores,
which could offer comparatively lower prices than their legitimate
competitors. It is said that the illegal practice has forced some
legitimate stores to close.
Yesterday, one of eight cases involving smugglers was heard at
Shanghai No 1 Intermediate People's Court. Zhou Shengtao; Shen
Fengchang; Zhuo Ruibiaoi; Zhou's company, Shanghai Dichun Logistics
Co Ltd; and Zhuo's company, Zhuhai Longmen Musical Instrument Co,
face trial for having smuggled 68 secondhand pianos into the city
from March 2004 to February 2006, and for dodging more than 2
million yuan worth of tax. They all pleaded guilty.
A verdict has yet to be announced.
(China Daily April 11, 2007)