Zones caused tax loss: Auditor

China's "iron-handed" auditor general, Li Jinhua, accused some development zones, which are host to many foreign-funded companies, of expanding their scope without authorization or allowing companies outside zones to enjoy preferential policies, causing tax losses of US$830 million, state media reported. They also allotted land to investors at unreasonably low prices, resulting in the loss of US$695 million in government revenues. An examination of 48 ministerial-level departments and 274 affiliated units also found that US$688 million had been misused, leading to 76 arrests, prosecutions or sentencings for stealing or misappropriating public funds. The National Audit Office investigated 87 development zones in six municipalities and provinces between 2003 and June 2005, including Shanghai, Jiangsu and Zhejiang.