TAIPEI (Taiwan News) — KMT caucus convener Fu Kun-chi (傅崐萁) is accused of pressuring a mining company to withdraw its lawsuit against the Hualien County government over a disputed tax hike.

Fu An Mining Co. filed a lawsuit after Hualien County increased the Mineral Mining Special Tax sevenfold, exceeding the legal adjustment limit of 30%, per UDN. According to an audio recording obtained by Mirror Media, Hualien County officials allegedly warned the company that it could be ordered to suspend operations due to an expired permit.

In the recording, officials reportedly told Fu An Mining that larger companies, such as Asia Cement, had already paid the increased tax, suggesting Fu An Mining’s parent company, Lucky Cement, should follow suit, per NOWnews. Taiwan’s Ministry of Justice Investigation Bureau has received an anonymous tip implicating Fu and Hualien County Magistrate Hsu Chen-wei (徐榛蔚) in the alleged intimidation.

Fu’s office denied involvement in the tax hike or the alleged pressure campaign, stating the tax increase was passed by the Hualien County Council, which included Democratic Progressive Party members, and was later approved by the central government. Fu previously served as Hualien County magistrate during the tax hike.

His office characterized the allegations as part of a DPP-backed political maneuver amid a growing recall campaign against him, per ETtoday.

The Hualien County government defended the tax increase, citing increasing public demand for environmental protection, per CNA. The original plan raised the tax to NT$100 (US$3) per tonne, but was later reduced to NT$70 following discussions.

Officials also clarified that the audio in question was recorded during a meeting initiated by Fu An Mining. Subsequent investigations by the government ethics department and the Control Yuan reportedly found no evidence of misconduct.