Copyright The International Herald Tribune
FRIDAY, MARCH 31, 2006
LONDON On March 15, the China Consumer Journal named Hao Jinsong one of 10 “consumer rights-defending heroes” of 2005. Last year Hao successfully sued China’s state railroad authorities for failing to provide him with proper receipts on trains, ending a long-held privilege under which the railroad ministry had avoided paying tax.
Hao represents a new breed of activists in China who believe their individual actions can bring about institutional change and who have ingenious strategies for exploring the existing space for citizen participation. In pushing for change, they carefully avoid the confrontational stance adopted by political dissidents. Instead, they pick their fights skillfully.
Since March 1 this year, rail travelers have been able to obtain formal receipts printed by the State Administration of Taxation when they purchase goods from onboard shops or buy meals in dining cars. This ends a long-standing practice whereby the Ministry of Railroads had been able to avoid strict taxation of its income, since Chinese tax bureaus depend on formal receipts to assess the profits of companies.
How much money will the ministry lose as a result of Hao’s victory? Ministry statistics showed that the railroads carried more than 4.5 billion passengers from 2000 to May 2004. If each passenger spent 1 yuan (about 12 U.S. cents) during the journey, then the railroads made more than 4.5 billion yuan of taxable sales. This means a minimum of 225 million yuan of tax from 2000 to May 2004. Even though the railroads may have paid a lump- sum tax to the government coffers by special arrangements, tax officials admit that the railroads have traditionally been undertaxed.
Hao’s victory over the Ministry of Railroads didn’t come without a tough fight. The ministry is one of China’s most powerful, and lawsuits against it have to be judged in special Rail Transportation Courts, whose operational costs and staff salaries are all paid by the railroads.
The courts quickly ruled against Hao the first time. A subsequent appeal reviewed by higher rail transportation courts also failed. Hao’s second lawsuit met the same fate, but he persisted in filing a third suit.
In addition to suing the railroads, Hao wrote to the National People’s Congress, demanding that it examine the unconstitutional nature of the rail transportation courts. Citing the clause in the Constitution that courts should be independent, Hao argued that the rail transportation courts could not be expected to give fair trails to plaintiffs suing the railroads, and should therefore be abolished.
Hao also put pressure on the railroads in other ways. While the lawsuits were under way, Hao simultaneously made complaints to the State Administration of Taxation and the Beijing Dongcheng Tax Bureau about the railroads’ tax evasion. When he did not receive a satisfactory reply, he sued both the State Administration of Taxation and the Beijing tax bureau for dereliction of duty. His lawsuits were also widely reported, generating much public attention. In June 2005, Hao won his third case.
Beijing observers speculate that the central government’s desire to curtail the rail ministry’s powers played a crucial part in this extraordinary story of an ordinary citizen beating a powerful ministry. But Hao disagrees with those who conclude that one should not be too optimistic about the ability of individuals to force changes to public policy in China. Although often praised as a champion for consumers, he has broader objectives.
A graduate law student at the China University of Political Science and Law, Hao aims to defend civil rights, not just consumer rights, and to promote citizen participation in policy- making. He has consciously sought to arm himself with knowledge of the law and to use the law to pursue his goal.
Hao’s legal challenge in the name of a consumer wanting his railroad receipts was not politically sensitive and is likely to gain support from other government agencies and the public. But Hao has also used the case to pressure other state institutions, such as tax bureaus – and even the National People’s Congress – to be more accountable.
Activists like Hao are not concerned that they will not achieve success immediately. Hao was not surprised that he lost his lawsuits initially, but he believes that multiple litigation, whereby one person repeatedly goes to court over the same issue or several people simultaneously go to court over the same issue, can create tremendous pressure for change.
Such activists are careful to use strictly legal means to advance their causes and to avoid actions that carry high political risks. While Hao has set up a Web site to offer advice to others who feel their rights have been violated, Hao has resisted suggestions to open an online forum for discussion of rights issues, since he would not be able to control the content of the discussions and extremist views aired at such a forum could easily bring trouble.
In recent years more and more people have taken similar actions. These activists have drawn inspiration from one another’s experience. In 2005, Huang Jinrong, a legal scholar, also sued the railroads for including an insurance premium in the price of train tickets without informing passengers. He simultaneously asked the China Insurance Regulatory Commission to abolish the compulsory insurance imposed on passengers by the railroads. As expected, he lost the lawsuit. Consequently, like Hao, Huang sued the insurance commission for dereliction of duty. The court has not ruled in this case, but Huang knows there is a good chance he will lose again and has planned his next move: writing to the National People’s Congress to request a review of the regulations that have justified the practice.
The motives of people like Hao and Huang who file public interest lawsuits are diverse. Some are concerned with specific issues that appear to have no immediate political implications. Others are more conscious that even though they sue as an individual consumer protesting a compulsory fee, a service, a misleading advertisement or a price hike, such issues allow them to raise fundamental questions about the unchecked power of government agencies, their monopoly of public resources and their lack of transparency.
Such litigation allows the activists to use legal methods and nonpolitical issues to promote civil and political rights, the rule of law and accountable government. These activists know change will only take place gradually, but are confident that their actions will make an impact. As the Chinese saying goes, “Dripping water wears through rock.”
Yiyi Lu is a senior research fellow at the Royal Institute of International Affairs (Chatham House) in London.