TAX police hit hard at counterfeiters and fraudsters yesterday when three men were executed for making up illegal tax claims. The Supreme People's Court passed death sentences on the men, who were executed by their provincial governments the same day, two in Guangdong and the other in Liaoning province, said Xinhua (the New China News Agency). The executions were the first since the National People's Congress Standing Committee agreed last month to raise the penalties for VAT fraud. Under the tax system in China, businesses can claim rebates from the Government using VAT invoices. According to Xinhua, company manager Chen Songnan, of Chaoyang City, in Guangdong province, had been found guilty of issuing VAT invoices worth more than 150 million yuan (HK$139.5 million) without authorisation since September last year. Xinhua said his invoices cost the state 9.86 million yuan. The other condemned men were Shi Wanxiong, of Shantou, who was convicted of issuing VAT invoices worth 2.61 million yuan without authorisation and You Tianyou of Shenyang, Liaoning province, convicted of forging VAT invoices. Another invoice forger Xu Gang, in Sichuan province, was given a suspended death sentence. He was spared because he reported an escape plan by five inmates - four of whom faced execution. Yesterday's death sentences were announced in Beijing by Judge Liu Jiachen, Vice-President of the Supreme People's Court. Judge Liu reportedly said that all future VAT crimes would be tried following the new NPC rules and vowed that more heavy sentences would be handed down to lawbreakers. Officials reported 943 cases of 148,559 sets of false VAT invoices nationwide in 1994. The total illicit money involved amounted to 24.77 billion yuan and resulted in evasion of 4.26 billion yuan in taxes. Another court in the coastal city of Ningbo sentenced Wang Guoqiang and Lei Zhiyong to death earlier this month for setting up a brothel in a 'health centre', the Legal Daily reported yesterday. Wang and Lei were executed by firing squad on the day their sentences were issued. The usual method is to fire a single bullet into the back of the head. Five others were given prison terms ranging from five to 15 years for procuring women to work as prostitutes, the report said. Western human rights organisations have expressed concern over China's rising use of the death penalty, particularly those imposed for economic crimes.