• Sun
  • Apr 20, 2014
  • Updated: 9:09pm

Forbes will stick with its rich list, despite problems

PUBLISHED : Tuesday, 01 July, 2003, 12:00am
UPDATED : Tuesday, 01 July, 2003, 12:00am

China's businessmen are wary as many of those ranked have faced tax probes


US business magazine Forbes will press ahead with compiling a list of the mainland's 100 richest people despite the legal problems associated with some of the previous entrants that have made many entrepreneurs reluctant to co-operate.


'It will be coming out this year as it has in the recent years. I think the basic thrust is the same. We do try to improve it, as we've done in the US for 20 years,' president and chief executive Steve Forbes said during a visit to Shanghai.


Mainland financial industry officials say the central government has made the rankings an unofficial hit-list for tax audits.


Shanghai property tycoon Chau Ching-ngai, ranked 11th last year, is now under investigation for problem loans and land deals. He was recently detained by police in Shanghai, state media said.


Entrepreneur Yang Bin, ranked second in 2001, is on trial for corruption. Car executive Yang Rong, ranked third two years ago, fled abroad when faced with an investigation.


Mr Forbes said appearing on the list did not provide immunity from the law. He cited the case of Martha Stewart, former chief executive of lifestyle company Martha Stewart Living Omnimedia Inc. who is facing trial for securities fraud in the United States.


'Just because you are on the Forbes 100 list, does not mean you are immune to tax laws or any other laws. It just means at that particular moment, you've achieved a degree of success,' Mr Forbes said.


Mr Forbes was in Shanghai to announce formally that the city would host the annual Forbes Global CEO Conference in September. Hong Kong will host the conference next year.


He called on the mainland to establish transparent tax laws and legal institutions that would allow private businesses to flourish.


'There is a long tradition of entrepreneurship and inventiveness in this country,' he said.


'The problem has been, bluntly, that they [the authorities] haven't created an environment where you have institutional safeguards.'


State-owned companies make up the majority of the mainland's economy, and private firms have struggled to overcome prejudice.


However, the mainland's private entrepreneurs needed to understand they had to obey the law, Mr Forbes said.


'Part of the challenge for entrepreneurs is getting over the notion that cutting corners is essential to success,' he said.


'It also puts a burden on the central government to come up with a tax code, which I think they will soon do, that is simple, understandable and transparent.'


In unsuccessful bids for a Republican Party nomination for the US presidency in 1996 and 2000, Mr Forbes had pushed for a flat tax-rate.


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