(Yicai) Aug. 23 -- China is stepping up efforts to crack down on unjustified and illegal charges imposed by local governments on firms with the aim of improving the business environment.

The China National Audit Office will introduce a new mechanism to regulate charges levied by local authorities on businesses and enhance supervision, the country’s top auditor said recently.

Unjustified and illegal charges severely harm corporate interests and the business environment, according to experts. They maintain that while the clampdown on illegal fees has improved the situation in recent years, continued efforts are needed to strengthen supervision and establish a long-term mechanism to address the issue.

The State Administration for Market Regulation launched a campaign earlier this year to stamp out illegal charges on businesses, focusing on inspections and spot checks of government departments and their affiliates, industry associations, financial institutions, natural gas networks, and water utilities, as well as addressing standout issues with innovative tech firms and manufacturers.

The SAMR has inspected 44,800 entities and filed 1,253 cases so far, along with ordering CNY393 million (USD55.1 million) of illegal charges to be refunded, said Wang Guowei, head of its comprehensive planning department. Efforts to improve the reporting channels for unlawful charges will continue, he added.

Local governments demanded more than CNY1.6 billion (USD223.9 million) in funds and financial support from state-owned enterprises for 21 activities in 22 provincial-level regions last year, according to the 2023 annual audit report released by the CNAO in June.

Yangzhong in Jiangsu province spent more than CNY84 million (USD11.8 million) on seven pufferfish festivals between 2016 and 2023, of which CNY42 million was unjustified funds taken from companies, according to the results of a recent probe from the General Office of the Central Commission for Discipline Inspection and related government agencies.

Counties and cities in Hubei collected nearly CNY37 million by overcharging on water, electricity, and gas installation fees, collecting illegal urban road occupancy fees, charging unauthorized land price evaluation fees and bidding agency service fees, according to the provincial audit report.

Editors: Zhang Yushuo, Futura Costaglione