The State Administration of Taxation has issued a circular to increase supervision of projects contracted by foreign companies in China.

The taxation management over foreign-funded companies is still quite weak in China, and tax evasion is especially serious in projects contracted by foreign companies, the circular said.

The circular asked local taxation departments to collect more information and inform foreign enterprises about Chinese taxation policies and laws.

Local departments should go all-out to remove loopholes and collect overdue taxes from foreign-contracted projects, the circular said.

More contracted projects are now being launched by overseas companies in China, especially in fields of Olympic stadium construction, transport and energy.

(Xinhua News Agency July 20, 2006)