Shantou's city government has promised to investigate claims by taxi drivers that officials are illegally profiting from their trade, mainland media reported.
The pledge came after more than 1,000 taxi drivers took to the streets of the city on Thursday, calling for a crackdown on illegal cabbies they accuse of eating into their business, with the tacit consent of officials.
Shantou's deputy mayor, Su Yaoguang, said municipal authorities would investigate whether officials related to the taxi trade had been engaged in graft, the Guangzhou Daily reported yesterday.
The rally in Shantou was part of a wave of protests across the mainland that began when 9,000 drivers stopped work in Chongqing on November 3. Since then, taxi drivers have gone on strike in Hainan, Guangdong, Gansu, Jiangxi and Yunnan .
The drivers are angry over fuel prices and fees to rent their taxis.
In cities like Shenzhen and Shanghai, they must pay at least 500 yuan (HK$570) in rent to their companies each day. The drivers complained they have to work about 18 hours a day to meet the rent and take home just 3,000 to 4,000 yuan a month.
At the same time they are seeing increased competition from unlicensed cabs.
Drivers have complained that officials tacitly allowed unlicensed operators in return for an 800 yuan monthly fee for each vehicle.
'The monopoly creates opportunities for certain officials to take bribes, which places a heavy burden on taxi drivers,' veteran Shenzhen People's Congress member Yang Yiping said. 'We have heard from cab drivers for years that some transport officials in charge were receiving up to 70,000 yuan in 'tea money' for each new licence.'
Last year, a 12-year taxi licence fetched more than 540,000 yuan at an official auction in Shenzhen.
'The situation is common in the taxi trade in many places,' Mr Yang said. 'Taxi drivers have to buy the car, pay the tea money and hand in a large share of their earnings to the operator to pay the licences.'
Shenzhen managed to diffuse growing anger when its transport administration announced last week that monthly rental fees would be reduced by up to 1,000 yuan.
Shenzhen taxi drivers have a history of voicing their grievances, most notably in October 2005, when hundreds of drivers took to the streets to protest against high rental fees. But the government ended the strike after a few hours.
A Shenzhen taxi driver said many of his colleagues had no choice but to turn to the unlicensed taxi business.
'The costs of a legal taxi are too high to make a living and compete with underground cabs,' he said.
Mr Yang said he had called for the authorities to change the way the taxi trade was run.
'The situation remains the same,' he said. 'It would be sad if only mass bloody riots could make the government take it seriously.'