The China Daily reports that Customs police discovered a cache of nearly 5,000 unsold pianos; Chinese smugglers are suspected of evading around $1.3 million worth of taxes selling the contraband instruments.
The paper writes that Shanghai piano dealers had become aware that cheaply-priced second-hand pianos from abroad were dominating the market. Most of those pianos had price tags of between $200 and $250, "leading Customs to suspect that the whole industry was in collusion with smugglers." In 2004, imports accounted for 52% of all of the pianos imported to Shanghai; the figure rose to 73.95% in 2005.
Investigators found that smugglers were working with overseas sellers to fake the declared prices of imported instruments so that they could avoid paying taxes, according to the Daily. The smugglers then sold the pianos to local stores, forcing legitimate stores, unable to compete with such low prices, to close.
Eight separate cases of piano smuggling are being heard in Shanghai. All defendants in the first case, which opened yesterday ,pleaded guilty, according to the paper. The two middlemen on trial were accused of assisting four musical instrument companies dodge more than 2 million yuan ($250,000) in duties on nearly 1,000 secondhand pianos from Japan, the Shanghai Daily reported.
Prosecutors allege that the defendants either falsified invoices or asked Japanese dealers to provide invoices significantly understating the value of the pianos.
No verdict has yet been announced.