Legislators yesterday refused to approve the controversial Highway Law, highlighting tension between Beijing and regional authorities.
The rejection came as a snub to Premier Zhu Rongji, who had hoped the law would give him the power to abolish the hundreds of toll fees levied by local officials on highway users and replace them with fuel taxes.
A National People's Congress Standing Committee meeting yesterday voted 77-6 for the legislation, while there were 42 abstentions, Xinhua said. Seventy-eight votes were required to pass the legislation.
Xinhua said some Standing Committee members voted against it because they feared the fuel tax would 'increase farmers' burdens'.
Toll fees at present make up a significant portion of local government revenue. Premier Zhu wanted to abolish the toll fees, which are unpopular with farmers.
Some committee members who represented local interests attacked the new law, saying it amounted to a 'retreat to central planning', referring to the era when the central Government micro-controlled the economy.
Others said that if the law was adopted it would cost farmers more to use machinery.