The protest was the latest in recent months by workers and companies worried about government moves to restructure industries or job losses due to the economic crisis.

 

Photographs and video footage posted on Chinese Web sites showed crowds in Nankang in Jiangxi province filling a street junction, surrounding overturned police cars and spilling over onto a highway and halting traffic.

 

The Nankang city government said in a statement that another 100 people gathered at a local administration building to petition against the tax that came into effect Monday.

 

Furniture companies said the tax would significantly squeeze their already slim profit margins. The government has used taxes and other methods to streamline industries or restructure low-valued-added ones.

 

The owner of Qianchao Office Furniture, who refused to give his name, said the tax may force him to shut his business, which employs dozens of people.

 

Details of the new tax policy were not immediately available, but another furniture maker said that for each bed her company sells she has to pay 8 yuan ($1.20) -- as much as a third of her profit.

 

Meanwhile, in the northwestern city of Xining, hundreds of taxi drivers staged a third day of strike action Monday, angered by a news report that suggested a new regulation would curtail the duration of their operating licenses, the official Xinhua News Agency reported.

 

Last year, strikes by taxi drivers partially shut down nearly a half dozen cities across the country, including Chongqing, the biggest metropolis in the country's southwest, and the southern island resort of Sanya.