Chinese Stocks Fall After Government Increases Taxes

China’s stock market tumbled in one of the biggest sell-offs in years. It followed the government’s move last week to impose higher taxes on stock trades.Stock investors looked at the price monitor at a securities company in Shanghai, China. The sell-off today in Shanghai was one of the largest declines in a decade, and was nearly comparable to the sharp drop in February this year when the Shanghai Composite fell 9.9 percent after a phenomenal rise. But prices have continued to soar on unprecedented demand for stocks, fueled by the opening of hundreds of thousands of new share accounts every day. The government has repeatedly warned investors about the risks of a downturn, and even moved to calm the markets. When the government reversed course last week and imposed higher taxes on stock trades, investors vented their anger online and there were even reports that several government web sites, including a finance ministry site, had been hacked into and taken down for a time.

http://www.nytimes.com/2007/06/04/business/worldbusiness/04cnd-chinastox.html?_r=1&hp&oref=slogin